EC Grants €1.1bn to Clean Energy Projects from EU ETS Revenues

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EC Grants €1.1bn to Clean Energy Projects from EU ETS Revenues
The European Commission (EC) granted €1.1 billion to support clean energy projects from the EU Emissions Trading System (ETS) fund.
 
The EC signed agreements to grant 7 projects that support the EU’s climate transition. The funding is from the Innovation Fund, sourced from the EU ETS. This Fund comes from 450 million allowances from the current EU ETS in 2021/30.
 
Under the EC’s Fit for 55 proposals, 50 million allowances more will be added to the fund from the revised ETS. There will also be 150 million allowances more from transport and buildings emissions.

The 7 Clean Energy Projects Financed by EU ETS

The projects aim to reduce emissions by over 76Mt of CO2eq during the first 10 years of their operation.
 
These projects are using innovative low-carbon technologies at an industrial scale. They span various major sectors like hydrogen, biofuels, solar energy, cement, steel, and chemicals. The carbon capture and storage are also covered.

Here is a sneak peek of the clean energy projects granted by the EU ETS Fund:

Kairos@C in Belgium. This project aimed to avoid emissions of 14 Mt of CO2eq. It intends to make the first and biggest cross-border carbon capture and storage.
 
BECCS at Stockholm. This other one plans to avoid 7.83 Mt of CO2eq. It will create a Bio-Energy Carbon Capture and Storage (BECCS) facility at a heat and power biomass plant. BECCS will use both CO2 capture and heat recovery.
 
Hybrit Demonstration in Sweden. This project will replace fossil-based technology with green alternatives like hydrogen use. Thus, it will revolutionize the iron and steel industry in Europe, avoiding about 14.3 Mt of CO2eq.
 
Ecoplanta in Spain. Among the clean energy projects supported by EU ETS, this one will hit the smallest CO2 avoidance of 3.4 Mt of CO2eq. It will use waste to deliver a first-of-a-kind commercial plant in Europe, recovering 70% of CO2 in waste.
 
K6 Program in France. Meant to avoid 8.1 Mt of CO2eq, this program will produce the first carbon-neutral cement in Europe. It will do so by using an airtight kiln and cryogenic carbon capture technology and will store CO2 in the sea.
 
The TANGO project in Italy. This one avoids the highest 25 Mt of CO2eq by producing high-performance PV modules and multiplying capacity by 15x more (200 MW – 3 GW).
 
SHARC Project in Finland. This Sustainable Hydrogen and Recovery of Carbon project aims to avoid over 4 Mt of CO2eq. It will reduce emissions by using renewable hydrogen and carbon capture technology.

EU’s Transition to Green

According to the European Green Deal, funding those clean energy projects via EU ETS is “… a smart investment into the decarbonization and resilience of Europe’s economy.”
 
Also, it raises Europe’s stance on clean technology while helping speed up its green transition.
 
Better yet, the shift to renewable energy is the key to reducing emissions and reaching the EU’s net-zero goal in 2050. And the funding from the EU ETS to support those clean energy projects is one step toward that.

Climeworks Raises $650 Million to Scale Up Its Carbon Removal Technology

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Climeworks Raises $650 Million to Scale Up Its Carbon Removal Technology

Climeworks, a Swiss startup, has raised $650 million for scaling up its carbon removal technology (direct air capture).

Global GHG emissions should peak before 2025 to avoid disastrous climate change effects, according to a report by the IPCC. It says that the world has to act now to prevent warming from going beyond the critical temperature of 1.5°C.

Such a scenario does not only need massive reductions in carbon emissions. It also requires removing the existing CO2 in the air. And Climeworks is one of the startups that provides a means to do it.

Climeworks Carbon Removal Technology

Climeworks is running the biggest carbon removal plant in the world, based in Iceland. This direct air capture (DAC) technology traps CO2 and injects it into the underground.

The image below illustrates how this carbon removal technology works.

As shown above, it works by moving huge quantities of air through a special chemical that filters out CO2. It functions like a magnet that attracts iron fillings.

The captured air is heated to release the pure CO2 stream that is then pumped deep underground, where it becomes stone.

Currently, Climeworks’ DAC plant can capture only around 4,000 tons a year. This corresponds to the yearly emissions of about 600 people only residing in Europe.

So, if Climeworks wants to have significant contributions to meeting climate goals by 2050, it has to scale up its DAC operations. This is why the funding is very important for its purpose of scaling up.

Where Will the Equity Funding Go?

So far, the $650 million equity funding is the biggest amount ever raised by a carbon removal company.

The financing is from some of the most renowned and largest institutional technology investors. These include Partners Group, BigPoint Holding AG, GIC, and Global Founders Capital. Other investors are from Baillie Gifford, Swiss Re, John Doerr, M&G, and more.

The funding will help unlock the next phase of Climeworks’ carbon removal growth, ramping up its DAC to a multi-million-ton capacity.

The startup will use the money to build a 40,000-ton DAC plant with the goal of capturing over a million tons a year by 2030.

When asked about the plant’s location, the CEO, Christoph Gebald, said, “Iceland is a top favorite because of its excellent geology.”

Other potential locations are Norway and Oman. Or it could be somewhere else in North America where there is access to cheap green energy. This is vital due to the nature of the direct carbon removal process.

The DAC technology is very energy-intensive because of the procedures involved. And thus, using only renewable or carbon-free energy is a must so as not to negate its goal of cutting emissions.

Right now, Climeworks’ direct competitors are the Canadian startup Carbon Engineering Ltd. and the US-based Global Thermostat.

Meanwhile, Climeworks continues to scale up. It was a Venture Kick winner in 2010, a Venture Leader in 2017, and one of the TOP 100 Swiss Startups from 2011 to 2014.

The startup expects to grow and reach 400 workers by the end of next year, up from 180 employees today.

Stellantis Plans to be Carbon Net Zero by 2038 Without Tesla

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Stellantis Plans to be Carbon Net Zero by 2038 Without Tesla

Stellantis, the 6th largest automotive firm worldwide, revealed its plan to become carbon net zero by 2038.

The automaker owns 14 different car brands. These include famous ones like Fiat, Chrysler, Dodge, Ram, Jeep, Alfa Romeo, Citroen, Peugeot, and Maserati.

The company seeks to be the industry champion in fighting climate change. It uses its 2021 emissions as a baseline to reduce Scope 1 and 2 by 50% in 2025 and 75% in 2030.

And unlike most auto companies that plan to hit net zero goals by 2050, the automaker aims to achieve it by 2038.

Stellantis 2021 Baseline for Carbon Net-Zero Plan

In 2021, Stellantis Scope 1 emissions equal to over 1.6 million tonnes of CO2eq, while Scope 2 emissions amounted to 2.2 million tonnes of CO2eq. This translates to 0.663 tons of CO2eq per vehicle manufactured.

Here is the company’s breakdown of GHG emissions per region for 2021 for more details.

Stellantis Carbon Emissions

When it comes to tracking and managing its carbon footprint and targets, Stellantis follows the SBTi (Science-Based Target Initiative) method.

For 2021 alone, the automaker’s emissions of CO2 eq for cars sold in Europe only is equal to 136 million tonnes.

The images below show the firm’s main emission items by activities per emissions scope.

Stellantis Scope 1-2

Stellantis’ initiatives in the previous year allowed it to reduce direct emissions (Scope 1 + 2) by 49,924 tonnes of CO2eq. This is equivalent to 8.8 kg of CO2eq per vehicle produced.

For instance, the electrification ramp-up and technical improvements to its cars reduced significant emissions. This particularly involves its battery electric vehicles (BEVs) and low emission vehicles (LEVs).

The LEV models sold in 2021 accounted for 12.8% of passenger cars in Europe and 3.4% (cars and trucks) in the US.

In line with Stellantis’ carbon net-zero target, it plans to make LEV sales become 100% in Europe and 50% in the US in 2030. Likewise, the automaker also aims to have more than 75 BEVs and earn BEV sales of 5 million vehicles by the end of this decade.

For the same year, Stellantis also managed to invest over €6.3 million in energy savings, corresponding to about €1.1 per vehicle produced. It was also able to gain a share of decarbonized electricity of 45%.

Stellantis Carbon Emissions Roadmap

To become carbon net-zero in 2038, the automaker focuses on the following main levers.

Short term 2025:

  • Energy management in all plants

  • Energy-efficient projects

Medium-term 2030:

  • Site compression and improvement of industrial footprint

  • Use and production of renewable energies

Long term 2038:

  • Technical innovations (e.g. Hydrogen, Power to gas)

  • CO2 capture and storage

  • Compensation of residual emissions

In addition, the firm continues to invest in CO2 reduction projects. This entails taking part in major emissions allowance schemes. These include the EU ETS and the Canadian Federal Output-Based Pricing System (OBPS).

Stellantis implemented two distinct internal carbon prices to aid its investments.

The first one refers to the shadow price of carbon. Its purpose is to show industrial climate-related risks and opportunities to guide the firm on which projects to invest in.

The other one is called the internal carbon price. This is to measure the cost efficiency of Stellantis’ technical levers that reduce vehicle emissions.

Finally, to make its reduction efforts run smooth, the firm links its 3 major CSR issues to its net zero ambition. These are:

  • Vehicle CO2 emissions (100% nameplates with BEV offering in EU and US)

  • Industrial and sites carbon footprint (Scope 1 and 2 emissions are net-zero)

  • Carbon footprint of the supply chain: purchasing and logistics
    (carbon net-zero per Paris Agreement)

On top of its carbon net-zero plan, Stellantis also aims to double its net revenues to $335 billion by 2030. This and sustain its big profit margins while growing efforts to electrify its cars.

PNG Suspends New Carbon Credit Deals While Writing New Rules

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PNG Suspends New Carbon Credit Deals While Writing New Rules
The government of Papua New Guinea (PNG), suspended new voluntary carbon credit projects while making new rules to govern them.
 
PNG decided to develop a stronger legal framework governing voluntary carbon credit deals. These carbon credit schemes are arrangements made between developers and resource owners directly. Government is not part of the negotiation.
 
While PNG is creating new laws, the environment ministry, Wera Mori, set a moratorium on new carbon deals. This action was due to red flags raised over a new carbon credit deal in the Oro province.
 
The temporary ban covers all the new carbon deals. The ministry said that this is “… To ensure proper stock take and audit of existing voluntary carbon projects.”

Why PNG Bans Voluntary Carbon Credit Deals

The moratorium came after an industry watchdog, got the government’s attention. The group faulted the 100-year carbon credit scheme in Oro province, citing a lack of key details.
 
They also called on Verra, a global certifying body for voluntary carbon standards, to reject the Oro deal.
 
In response, the PNG government banned the deal and other new carbon credit schemes in the meantime. But once the new regulations are in place, the voluntary carbon market in the country will be open again.
 
Though the suspension will impact the carbon credit market big time, it’s a must. In fact, the Oro province governor, Gary Juffa, said that it’s well overdue.
 
Juffa noted that this has been the case for far too long already. The so-called “carbon cowboys” have been collecting big profits from carbon credit deals. But they are giving the forest stewards and caretakers in the province very little.
 
The coalition of other concerned society groups is also pressuring the government to have strict rules regulating the market. They said that there are already voluntary carbon projects in every part of PNG.
 
Without the safeguards like free, prior, and informed consent (FPIC), the market will take advantage of the native landowners.
 
FPIC is a legal tool meant to protect native landowners against commercial loggers.

The Carbon Credit Market and PNG

Carbon credits are regarded as a pivotal means for countries to hit net-zero emissions goals. Unfortunately, outside Europe, the voluntary carbon credit market remains unregulated. And the case of PNG is one example.
 
The country is home to the world’s 3rd largest tropical rainforest. It keeps 7% of the earth’s biodiversity, making PNG so attractive to carbon financiers.
 
Even more important, protecting the forests is vital to PNG’s climate goals. That is to halve emissions by 2030 and be carbon neutral by 2050.
 
Also, PNG has been the world’s biggest tropical timber exporter since 2014. But, over 70% of timber production in the country is illegal, according to reports.
 
So, if carbon cowboys continue to sway landowners to do unregulated carbon projects, the forests will be at risk.
 
Hence, having safeguards on these projects is crucial for PNG’s carbon market to thrive, ensuring that there is proper oversight. 

IPCC AR6 Report on Climate Change: We Must Act Now

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IPCC AR6 Report on Climate Change: We Must Act Now
The Intergovernmental Panel on Climate Change (IPCC) released the third and final installment of its AR6 report on climate change.
 
The report is Working Group III’s contribution to IPCC Sixth Assessment Report (AR6). It was published today after getting the approval of 195 member governments of the IPCC.
 
Along with the two other AR6 reports, this report is vital for climate science analysis. 
 
In general, it provides scientific data on annual GHG emissions from 2010 to 2019. It also lays out potential solutions on how to reduce emissions. These solutions are the consolidated ideas of 278 scientists from 65 countries.

Evidence Presented in IPCC AR6 Report on Climate Change

The key message of the report is this: to make our planet safe for the next generations, we must act now. It means the entire world needs urgent action to reduce GHG emissions across all sectors.
 
Otherwise, the goal to limit global warming to the critical 1.5 degrees Celsius is beyond reach.
 

The IPCC’s AR6 report on climate change shows scientific evidence why we should act now or it would be too late.

From 2010 to 2019, the average annual global GHG emissions were at their highest historical levels, as shown below.

Figure SPM.1: Global net anthropogenic GHG emissions (GtCO2-eq yr-1) 1990–2019

Though the rate of increase has slowed down, the next few years’ warming reductions are critical.
 
The assessment indicates that getting to 1.5°C requires GHG emissions to peak before 2025, at the latest. Then the emissions must go down by 43% by 2030. Meanwhile, a reduction of around a third in methane is also a must.
 
In the words of the IPCC Chair, Hoesung Lee, “We are at a crossroads. The decisions we make now can secure a liveable future. We have the tools and know-how required to limit warming.”
 
Lee also noted that there are climate actions taken by countries that are proving effective. Likewise, there has been a consistent decrease in the costs of renewable energy of up to 85% since 2010.
 
Another essential report highlight is the creation of policies that improved energy efficiency. Also, global efforts had lowered deforestation rates while enhancing the use of renewables.
Figure SPM.3: Unit cost reductions and use in some rapidly changing mitigation technologies
But still, more concerted efforts to achieve massive emissions reductions are necessary.

IPCC’s AR6 Solutions to Mitigate Global Warming

The AR6 report outlines climate mitigation strategies that cover all the major sectors. These include energy, transport, buildings, urban, industry, forestry, and agriculture.
 
Scientists in the IPCC believe that if those climate mitigations will take effect, the world can at least reduce emissions by half by 2030.
 
While rapid reductions have to occur across the board, the biggest impact will be from the energy sector. This means significant reductions in fossil fuel use and widespread electrification. It also calls for more energy efficiency and the use of alternative fuels like hydrogen.
 
In other main emitter sectors, the same solutions may also help reduce emissions. Carbon capture and storage can also be a potential option to help mitigate warming.
 
Finally, IPCC’s AR6 report on climate change stresses the need to consider other means. The two important ones are closing global investment gaps and achieving SDGs.
 
All three IPCC AR6 reports will be synthesized and published in September right before the major COP27 happens in Egypt.

India’s Ambitious Climate Goal Threatens by the Power Sector

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India’s Ambitious Climate Goal Threatens by the Power Sector

India’s lofty climate goal is at risk due to the financial problems that power retailers face, along with other issues.

Part of the country’s green plan is to increase renewable energy capacity by the end of 2022.

But estimates from BloombergNEF reveal that India is likely to miss its 175 GW target. This translates to around 36% of failing to achieve such renewables goal.

This scenario is an indicator that the country is having structural issues on its way to net zero. The power suppliers, in particular, which control about 90% of the nation’s electricity supply are one of the main culprits.

How Hard is it to Achieve India’s Climate Goal?

The financial distress of India’s power retailers is the key reason why its 2022 target seems to fail. They struggle to pay off debts and recover losses, affecting their service delivery.

Such a situation led to power suppliers’ missed payments to power producers. In effect, it also impacts other transactions across the industry, hindering growth.

For instance, wind projects that won government auctions did not manage to take off. This is largely linked to the issues confronting the distribution utilities.

Thus, industry experts believe that it’s imperative not to rely on state power retailers in hitting India’s climate goal.

Otherwise, it will put the nation’s climate goals at risk.

One way to expand its renewables target is to use new technologies like green hydrogen. This prompted the government to use extreme measures to offer citizens affordable, clean energy.

Unfortunately, the quest for clean energy has driven energy prices too high. This makes things even more challenging for the nation to advance its climate plan. Other major factors are also at play.

Too many policy changes and tax matters.

“Renewable energy is a business where making the most out of the investment is vital”, the CEO of a solar power developer said. But, if there are too many changes in a policy that affect the cost, growth in the sector becomes slow.

Also, taxes and import tariffs increases caused uncertainties in costs. For example, a sharp rise in renewable energy equipment taxes, from 5% to 12%, hit power developers so hard.

Likewise, major solar power developers in India are dubious about the new import tax. They are forced to delay big solar projects, holding 900 MW, because of a high customs tax of 40%.

Such is the case with the renewables partnership between Scatec ASA and Acme Solar Holdings. There are other renewables projects that can largely contribute to India’s climate goal. But those structural issues are putting them on hold.

So, What Comes Next for India?

India managed to report some renewables achievement, 152.9 GW + 72.6 GW, powered by hydro, solar, and wind. But still, such figures are too far from India’s ambitious climate goal set by Modi at the COP26 summit.

The country seeks to have 500 GW of renewables by 2030, getting huge interest from investors.

Yet, what’s even more critical than winning investors’ attention is fixing the major problems hurting the power sector in India.

Netflix Bought 1.5 Million Carbon Credits in 2021

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Netflix Bought 1.5 Million Carbon Credits in 2021
The streaming giant, Netflix, bought 1.5 million carbon credits in 2021.
 
The technology company said that such an amount of carbon offsets had cut down its scope 1 and 2 emissions by 10%. The carbon credits were from 17 carbon projects the firm chose from more than 150 million tonnes.

Projects Comprising Netflix Retired Carbon Credits

Most of the projects are under Verra, a global carbon crediting organization.
 
One of them is the Vida Manglar Blue Carbon. The project is for protecting the mangroves and biodiversity of the Colombian Caribbean. It accounts for the full value of mangroves as a nature-based climate solution.
 
Netflix also retired carbon offsets from various projects verified in the Verra registry. These include the Chyulu Hills REDD+ Project which protects 410,000 hectares of forest in Kenya.
 
Another one is the Envira Amazonia Project. It is a tropical rainforest conservation project in Brazil. Likewise, the Kasigau Corridor REDD+ Project also protects a wildlife forest in Africa.
 
Other projects are the Northern Kenya Grasslands Project and the Reforesting Degraded Lands in Chile. Both projects are also under Verra management.
 
With those carbon projects, Netflix stated it had avoided about 14,000 tonnes of emissions last year. Retiring the credits from the projects enabled the firm to be on track with its carbon goals.

Netflix Net-Zero Carbon Targets

Last March 2021, Netflix revealed its “Net Zero + Nature” plan to hit net-zero GHG emissions by the end of 2022. The company’s approach to net-zero involves three R’s: Reduce, Retain and Remove.
 
Reduce means reducing Netflix scope 1 and 2 emissions by 45% in 2030, per the SBTi Guidance. This requires switching to using renewables and sustainable aviation fuel during film productions.
 
Retain involves keeping existing carbon storage by preventing more CO2 from reaching the air. Under this strategy, Netflix focuses on carbon credits that conserve at-risk natural areas. These include tropical forests and other critical ecosystems.
 
Lastly, Remove refers to investments in projects that capture and store carbon through natural solutions like grasslands and mangroves. The Vida Manglar Blue Carbon, in particular, is an example.
 

What makes Netflix’s carbon offset projects of high quality is its diligent evaluation process. It includes a five-step screening of RFP-based procurement, resulting in identifying the highest-quality nature-based projects

 
According to reports, Netflix managed to retire a total of 1.3 million carbon credits from the start of 2021.
 
Unfortunately, all full-scope emissions increased by 50% from 1.05 million tonnes in 2020 to 1.54 million tonnes in 2021. This was due to the increase in TV and film productions after the pandemic.

The Importance of Scope 3 Emissions in The Race to Net Zero

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The Importance of Scope 3 Emissions in The Race to Net Zero

The pressure to seek net zero pledges that include Scope 3 emissions is rising.

Here is an overview of the differences between Scope 1, Scope 2, and Scope 3 emissions.

Scope 123 emissions

CO2 emissions falling under Scope 3 include value chain emissions, and carbon footprint from suppliers, customers, business travels, company leases, and more.

Businesses with low Scope 1 and 2 emissions, but high Scope 3 emissions may soon face financial issues if they don’t pay attention to it. Why is that so?

Investors’ Focus Favoring the Importance of Scope 3 Emissions

Before investors were looking for companies to reduce only operational emissions (Scope 1) and indirect emissions from energy purchases (Scope 2).

But now, they are shifting their focus to the whole business supply chain.

ESG investors are looking for companies that are able to change and commit to achieving climate goals.

Thus, the main question they have concerns the entire activities that firms are doing or not relating to emissions. This means the importance of Scope 3 emissions is of high interest, too. In fact, it is where the largest carbon footprint is happening.

According to the Greenhouse Gas Protocol, there are 15 classes of Scope 3 emissions. GHG Protocol uses a world-renowned standard to measure and manage GHG emissions of companies and their value chains. It identifies “purchased goods and services” and “use of sold products” as most vital.

Take for instance the case of the oil and gas industry. O&G companies often have big Scope 3 emissions from end-product combustion.

Those value chain emissions are even much higher, 6x or more than the combined Scope 1 and 2 emissions.

In fact, many businesses have Scope 3 emissions that account for over 70% of their total footprint.

Why Dealing With Value Chain Emissions is Tricky?

As investors prefer a low emissions economy, a company’s climate plans have to align with it. But, companies with high supply chain emissions but low operational emissions may find it tough.

The financial challenge is due to various things. These include policy risks, carbon pricing, and shifts in end-product market demand.

Worse is that companies don’t have enough control over their Scope 3 emissions. This makes factoring in and managing supply chains emissions complex and burdensome.

Complicating the issue is a lack of regulatory guidance promoting the importance of Scope 3 emissions.

SEC had recently issued a proposed rule on emissions disclosure. Yet, while it has clear guidelines on Scopes 1 and 2 disclosure, disclosing supply chain emissions is left to the company to determine.

Is Scope 3 emissions “material” to disclose, too? It depends on the firm to decide.

For bigger companies that have been reporting all their emissions, it is a must. But for smaller ones that don’t have the capacity to do it, they are an exception to the SEC’s rule.

IETA Releases Guidelines on Blockchain Use in Carbon Markets

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IETA Releases Guidelines on Blockchain Use in Carbon Markets
The International Emissions Trading Association issued guidelines on blockchain use in carbon markets.
 
IETA is the main lobby group for the international Voluntary Carbon Markets (VCM). It aims to establish a functional framework for trading in GHG emission reductions.
 
For years, the IETA is tracking digital innovations that can improve VCM performance. Just recently, it has issued a set of preliminary principles for using blockchain in VCMs.

What Prompts IETA’s Guidelines on Blockchain Use in Carbon Markets?

The IETA has observed the rapid emergence of digital carbon assets. And so, they decided to create the guidelines as a precautionary measure. They added that digital tokens must only be from recognized carbon standards.
 
Likewise, the IETA requested carbon registries like Gold Standard to make proper labeling. More so, they need to hold carbon credits in escrow accounts to prevent double selling.
 
Also, the body calls on all carbon standards to review blockchain providers. This is part of the industry’s Know Your Customer (KYC) and Anti-Money Laundering (AML) checks.
The following are some of the key points of IETA’s preliminary guidelines.

IETA’s Initial Guiding Principles on Blockchain

  • Credible standards: carbon-backed digital tokens should come from verified and registered projects. Only government-approved carbon crediting schemes or the Standards must endorse those projects.
  • Registry control: it is only the Standards that may permit carbon credits tokenization. And so, the Standards must have a system in place to perform this role.
  • Tokens: tokens that are for issuance and verified are valid for stamping. But unverified, canceled, and retired carbon credits are not qualified for tokens.
  • Transparency: all token issuers are subject to KYC and AML reviews. This is important for consumer protection and transparency.
  • Investor Safeguards: issuers must ensure that digital climate assets are fit for investors. This is crucial in cases where there is no direct link to the underlying carbon asset. 
  • IT Security: the use of proven methods of protection against cyber threats is a must.
  • Claims: only the removed and retired tokenized credits are permissible for claims. The mere holding of the credits, not retiring them, are not valid for compensation claims.

Impacts of IETA’s Principles on Blockchain

Right now, many items of the guidelines on blockchain use in carbon markets are not executed yet. This is because carbon-backed blockchain initiatives are a recent development in the market. In fact, they are not governed by carbon regulations.
 
According to IETA, if market players follow those set of principles, they can aid in market growth. The carbon crypto innovations will speed up market linkages and expand access in developing nations.
 
A word of caution, though, from the administering body. If not done right, incorrect blockchain use in carbon markets may threaten public confidence.

Canada’s 2030 Emissions Reduction Plan: Clean Air, Strong Economy

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Canada’s 2030 Emissions Reduction Plan: Clean Air, Strong Economy
The Canadian government released Canada’s 2030 Emissions Reduction Plan.
 
It is the first plan describing the nation’s pledge to reduce its GHG emissions, drawing on the Canadian Net-Zero Emissions Accountability Act.
 
The Canadian Climate Institute’s President, Rick Smith, responded to the plan. He said, “This is a watershed moment for Canadian climate policy… For the first time, Canada has a detailed plan for meeting its emissions reduction goals.”

What’s in Canada’s 2030 Emissions Reduction Plan?

The Plan describes various actions that are already making notable emissions reductions. Better still, it outlines the new measures Canada needs to achieve its 2030 target and 2050 net-zero emissions.

Canada’s 2030 Emissions Reduction Plan entails $9.1 billion in new investments. It also includes measures sector-by-sector, covering all sectors, from agriculture to industrial businesses.

Canada will reach its 2030 emissions target by:

  • Helping to reduce energy costs for homes and buildings
  • Decreasing carbon pollution from the oil and gas sector
  • Empowering communities to take climate action
  • Powering the economy with renewables
  • Investing in nature and natural climate solutions
  • Supporting farmers as partners in building a clean, prosperous future
  • Maintaining Canada’s approach to pricing pollution

In particular, part of Canada’s 2030 Emissions Reduction Plan is to invest $2.9 billion to make buying zero-emission vehicles (ZEVs) more affordable.

It will also have a regulated sales mandate so that 100% of new passenger cars sold will be zero-emission by 2035. The interim targets for ZEV are 20% by 2026 and 60% by 2030.

Canada’s  Emissions Reduction Plan also reveals another $780 million to invest in the power of nature to capture and store carbon. These include the oceans, wetlands, peatlands, grasslands, and agricultural lands. Investments in this area will further explore the potential for negative emission technologies.

Even more crucial is reducing oil and gas methane emissions by 75% in 2030 while creating good jobs. The estimated contribution for the oil and gas sector alone is a 31% reduction from 2005 levels. This is equal to a 42% reduction from 2019 levels.

In 2019, Canada’s total national GHG emissions were 730 mt of CO2 eq, which is 9 mt lower than in 2005.
 
The biggest emitters are still the oil and gas and transportation sectors. Their emissions had increased more since 2005. Luckily, decreases in emissions by other sectors cover those increases.
 
But still, the country aims to drive its total emissions down from its 2005 levels by 40% in 2030. That means reductions to only 443 mt.
 
In perspective, the following chart represents Canada’s 2030 Emissions Reduction Plan per sector.
graph showing emissions trajectory
Canada’s 2030 Emissions Reduction Model and Framework
Canada’s Emissions Reduction Plan uses economic modeling to show its pathway to 2030. The model captures the potential for each sector to reduce its own emissions by 2030.
 
Many other governments are also using the same approach in charting their path to net zero.
As for the Plan’s framework, the Canadian Climate Institute is responsible for it.
 
To ensure the success of Canada’s 2030 Plan, the Institute’s Framework includes three core elements. These are the consistent path to net-zero, credible policies, and responsive processes.
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