[Top News] from [REUTERS]
[Green Business]
Europe's ECX skeptical on Australia carbon market
Thu Oct 29, 2009 1:51am EDT
By Bruce Hextall
GOLD COAST, Australia (Reuters) - The operator of world's largest carbon market, European Climate Exchange (ECX), has shelved plans to expand into Australia, concerned that the nation's planned cap-and-trade scheme had stalled.
London-based ECX's chief executive, Patrick Birley, played down recent signs of progress on the hotly contested Australian scheme, saying local lawmakers still appeared divided on it.
"There's no point in even thinking about it until the politicians make a decision," Birley told Reuters in an interview on Wednesday when asked about ECX's plans for Australia.
The Australian government is negotiating with the opposition with the aim of resolving a dispute over the planned scheme, which would require the country's major carbon polluters to purchase emission permits from mid-2011.
Parliament has already rejected the government's carbon-trading bill once. If it is rejected a second time in a vote due next month, Prime Minister Kevin Rudd could call a snap election on the issue, causing further delay and uncertainty.
Birley said ECX would only move into Australia when there was real demand for market pricing. He declined to give a time frame for that, saying the local situation was still too uncertain.
"If there's enough demand side from the users for a pricing mechanism we might look at it," Birley said.
"Across our group, we have different exchanges and different sets of customers so ultimately it's up to each of them to decide where to develop business."
ECX dominates Europe's carbon market with 98 percent market share, though four other exchanges also offer environmental derivatives. In 2008, overall market turnover was $118 billion and could exceed $200 billion this year, according to Birley.
FRUSTRATED BY SLOW PROGRESS
ECX's parent company, Climate Exchange Plc, has so far made only a very small bet on Australia, taking a 25 percent in carbon-exchange start-up EnVex, whose major backer is Australian investment bank Macquarie Group.
Australia's ASX Ltd, which runs the country's share and futures markets, is shaping up as the major player in what could quickly develop into a $10 billion-plus carbon market.
ASX also plans to offer futures trade in renewable energy by the year-end as Australia seeks to quadruple green power by 2020.
ECX's Birley voiced frustration at Australia's slow progress in developing a carbon market after almost a decade of debate.
"People have been tinkering away at the edges...there's definitely some good work being done but the big decisions are still to be made," he said.
"Europe's scheme isn't perfect but at least it is up and running, but here there seems to be too much emphasis on getting the design right," Birley added. "Showing leadership was what we were hoping, but we'll probably see leadership coming from Japan before Australia, which is an opportunity missed."
Japan's new government wants to introduce a compulsory cap-and-trade system for greenhouse gas emissions as early as the year to March 2012, the Nikkei business daily said last month.
Prime Minister Yukio Hatoyama has outlined a goal to cut such emissions by 25 percent from 1990 levels by 2020.
"Someone needs to make decisions here (in Australia) because if we can do it in Europe where there's 27 member states, why can't you do it in Australia?" Birley said.
(Editing by Mark Bendeich)
[Green Business]
China steps up climate diplomacy
Thu Oct 29, 2009 1:51am EDT
By Chris Buckley - Analysis
BEIJING (Reuters) - China's busy climate change diplomacy has become increasingly feverish weeks before crucial talks that could forge a new pact to fight global warming, or end in rancor that could rebound onto the world's biggest emitter.
President Hu Jintao told President Barack Obama last week that China wants a successful outcome in Copenhagen when the world gathers from December 7 to wrangle over the proposed new climate pact, and the topic is sure to feature when Obama visits Beijing in mid-November.
Recent weeks have brought a flurry of meetings between China and other big hitters in the negotiations, including India. Global warming will feature too at a China-European Union summit late in November.
But Chinese diplomats and advisers doing footwork for the negotiations have echoed growing international gloom, warning the Copenhagen talks could end with a feeble agreement that evades key issues or even fails to reach a deal.
"The real negotiations will be after Copenhagen," Yi Xianliang, a Chinese Foreign Ministry official involved in the climate talks told a meeting in Beijing last week. "Copenhagen will be a starting point, not an ending point."
Hopes negotiators will agree on a firm goal to halve worldwide greenhouse gas emissions by 2050 compared to recent levels appear dim, said Pan Jiahua, an expert on climate change policy at the Chinese Academy of Social Sciences.
As a coal-dependent behemoth with output of greenhouse gases likely to rise for many years yet, China could bear much of the brunt of any backlash if the talks fail to produce a solid deal. That could spill over into greater tensions over trade.
"With China such a big emitter, it wants to avoid becoming the scapegoat if negotiations are unsuccessful or even fall apart," said Wang Ke, who teaches environmental policy at Renmin University in Beijing.
"We feel it's already game-over. Copenhagen will be a rough compromise," he said. "China wants to take the initiative so it avoids being blamed if that's called a failure."
China's emissions of carbon dioxide, the main greenhouse gas generated by human activity, reached 6.8 billion tonnes in 2008, a rise of 178 percent over levels in 1990, according to the IWR, a German energy institute. U.S. emissions rose 17 percent over this period to 6.4 billion tonnes.
A MATTER OF TRUST
China is often denounced by Western critics as a stumbling block to agreement, because it argues developing countries should not submit to binding international caps on emissions while they grow out of poverty.
In turn, China and other developing countries have said the rich countries have done far too little in vowing to cut their own greenhouse gas output, and in offering technology and money to the Third World to help cope with global warming.
The weeks before Copenhagen appear unlikely to bring decisive progress in settling those and related disputes over commitments and verification.
"The likely outcome, we believe, may be to issue a framework political agreement," said Pan, the climate change researcher, who also advises the government.
"The long-term mitigation targets and medium-term goals will require subsequent tough negotiations."
Adding to the sober tone, the U.S. Special Envoy for Climate Change, Todd Stern, Wednesday scuttled expectations Obama's visit to China next month could produce a climate change deal.
But the summit between Hu and Obama may nonetheless help nurture greater trust so governments can reach a workable agreement in Copenhagen, said Deborah Seligsohn, China program director at the World Resources Institute in Beijing.
China's top leaders, including Hu and vice-Premier Li Keqiang, have been determinedly upbeat about success at Copenhagen.
Rifts have narrowed on issues such as establishing a central body to manage the spread of climate-friendly technology and financing poor countries' climate needs, said Seligsohn.
"If they're feeling they can trust each other, then these issues are not that difficult," said Seligsohn, a former U.S. State Department official who worked on environmental issues.
"I think it's a question of whether everybody is feeling optimistic and confident when they walk into the (Copenhagen) meeting."
But Lu Xuedu, a deputy director of China's National Climate Center who is involved in the negotiations, had little doubt hard bargaining lies ahead, before and after Copenhagen.
"In fact, sometimes in the climate negotiations, we don't dare even dash to the toilet, because when you come back in the room things have changed," Lu told reporters last week.
(Additional reporting by Emma Graham-Harrison; Editing by Jerry Norton)
[Green Business]
Europe's ECX skeptical on Australia carbon market
Thu Oct 29, 2009 1:51am EDT
By Bruce Hextall
GOLD COAST, Australia (Reuters) - The operator of world's largest carbon market, European Climate Exchange (ECX), has shelved plans to expand into Australia, concerned that the nation's planned cap-and-trade scheme had stalled.
London-based ECX's chief executive, Patrick Birley, played down recent signs of progress on the hotly contested Australian scheme, saying local lawmakers still appeared divided on it.
"There's no point in even thinking about it until the politicians make a decision," Birley told Reuters in an interview on Wednesday when asked about ECX's plans for Australia.
The Australian government is negotiating with the opposition with the aim of resolving a dispute over the planned scheme, which would require the country's major carbon polluters to purchase emission permits from mid-2011.
Parliament has already rejected the government's carbon-trading bill once. If it is rejected a second time in a vote due next month, Prime Minister Kevin Rudd could call a snap election on the issue, causing further delay and uncertainty.
Birley said ECX would only move into Australia when there was real demand for market pricing. He declined to give a time frame for that, saying the local situation was still too uncertain.
"If there's enough demand side from the users for a pricing mechanism we might look at it," Birley said.
"Across our group, we have different exchanges and different sets of customers so ultimately it's up to each of them to decide where to develop business."
ECX dominates Europe's carbon market with 98 percent market share, though four other exchanges also offer environmental derivatives. In 2008, overall market turnover was $118 billion and could exceed $200 billion this year, according to Birley.
FRUSTRATED BY SLOW PROGRESS
ECX's parent company, Climate Exchange Plc, has so far made only a very small bet on Australia, taking a 25 percent in carbon-exchange start-up EnVex, whose major backer is Australian investment bank Macquarie Group.
Australia's ASX Ltd, which runs the country's share and futures markets, is shaping up as the major player in what could quickly develop into a $10 billion-plus carbon market.
ASX also plans to offer futures trade in renewable energy by the year-end as Australia seeks to quadruple green power by 2020.
ECX's Birley voiced frustration at Australia's slow progress in developing a carbon market after almost a decade of debate.
"People have been tinkering away at the edges...there's definitely some good work being done but the big decisions are still to be made," he said.
"Europe's scheme isn't perfect but at least it is up and running, but here there seems to be too much emphasis on getting the design right," Birley added. "Showing leadership was what we were hoping, but we'll probably see leadership coming from Japan before Australia, which is an opportunity missed."
Japan's new government wants to introduce a compulsory cap-and-trade system for greenhouse gas emissions as early as the year to March 2012, the Nikkei business daily said last month.
Prime Minister Yukio Hatoyama has outlined a goal to cut such emissions by 25 percent from 1990 levels by 2020.
"Someone needs to make decisions here (in Australia) because if we can do it in Europe where there's 27 member states, why can't you do it in Australia?" Birley said.
(Editing by Mark Bendeich)
[Green Business]
China steps up climate diplomacy
Thu Oct 29, 2009 1:51am EDT
By Chris Buckley - Analysis
BEIJING (Reuters) - China's busy climate change diplomacy has become increasingly feverish weeks before crucial talks that could forge a new pact to fight global warming, or end in rancor that could rebound onto the world's biggest emitter.
President Hu Jintao told President Barack Obama last week that China wants a successful outcome in Copenhagen when the world gathers from December 7 to wrangle over the proposed new climate pact, and the topic is sure to feature when Obama visits Beijing in mid-November.
Recent weeks have brought a flurry of meetings between China and other big hitters in the negotiations, including India. Global warming will feature too at a China-European Union summit late in November.
But Chinese diplomats and advisers doing footwork for the negotiations have echoed growing international gloom, warning the Copenhagen talks could end with a feeble agreement that evades key issues or even fails to reach a deal.
"The real negotiations will be after Copenhagen," Yi Xianliang, a Chinese Foreign Ministry official involved in the climate talks told a meeting in Beijing last week. "Copenhagen will be a starting point, not an ending point."
Hopes negotiators will agree on a firm goal to halve worldwide greenhouse gas emissions by 2050 compared to recent levels appear dim, said Pan Jiahua, an expert on climate change policy at the Chinese Academy of Social Sciences.
As a coal-dependent behemoth with output of greenhouse gases likely to rise for many years yet, China could bear much of the brunt of any backlash if the talks fail to produce a solid deal. That could spill over into greater tensions over trade.
"With China such a big emitter, it wants to avoid becoming the scapegoat if negotiations are unsuccessful or even fall apart," said Wang Ke, who teaches environmental policy at Renmin University in Beijing.
"We feel it's already game-over. Copenhagen will be a rough compromise," he said. "China wants to take the initiative so it avoids being blamed if that's called a failure."
China's emissions of carbon dioxide, the main greenhouse gas generated by human activity, reached 6.8 billion tonnes in 2008, a rise of 178 percent over levels in 1990, according to the IWR, a German energy institute. U.S. emissions rose 17 percent over this period to 6.4 billion tonnes.
A MATTER OF TRUST
China is often denounced by Western critics as a stumbling block to agreement, because it argues developing countries should not submit to binding international caps on emissions while they grow out of poverty.
In turn, China and other developing countries have said the rich countries have done far too little in vowing to cut their own greenhouse gas output, and in offering technology and money to the Third World to help cope with global warming.
The weeks before Copenhagen appear unlikely to bring decisive progress in settling those and related disputes over commitments and verification.
"The likely outcome, we believe, may be to issue a framework political agreement," said Pan, the climate change researcher, who also advises the government.
"The long-term mitigation targets and medium-term goals will require subsequent tough negotiations."
Adding to the sober tone, the U.S. Special Envoy for Climate Change, Todd Stern, Wednesday scuttled expectations Obama's visit to China next month could produce a climate change deal.
But the summit between Hu and Obama may nonetheless help nurture greater trust so governments can reach a workable agreement in Copenhagen, said Deborah Seligsohn, China program director at the World Resources Institute in Beijing.
China's top leaders, including Hu and vice-Premier Li Keqiang, have been determinedly upbeat about success at Copenhagen.
Rifts have narrowed on issues such as establishing a central body to manage the spread of climate-friendly technology and financing poor countries' climate needs, said Seligsohn.
"If they're feeling they can trust each other, then these issues are not that difficult," said Seligsohn, a former U.S. State Department official who worked on environmental issues.
"I think it's a question of whether everybody is feeling optimistic and confident when they walk into the (Copenhagen) meeting."
But Lu Xuedu, a deputy director of China's National Climate Center who is involved in the negotiations, had little doubt hard bargaining lies ahead, before and after Copenhagen.
"In fact, sometimes in the climate negotiations, we don't dare even dash to the toilet, because when you come back in the room things have changed," Lu told reporters last week.
(Additional reporting by Emma Graham-Harrison; Editing by Jerry Norton)
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