Bloomberg Green Archives - Nucleation Capital

According to Bloomberg Green, China's national carbon market opened with a "flurry of trades that sent prices surging." This is exceptionally exciting news, yet Bloomberg's annonymous report went on to enumerate many reasons why this is a less than stellar achievement, claiming that "it’ll be years before the system helps the top polluting nation curb its emissions."

We say "bull pucky" to that. China pulls way ahead of the U.S. with this launch, which requires even state-owned oil giants such as China Petroleum & Chemical Corp., known as Sinopec, and China Energy Investment Corp., one of the world’s largest coal producers, to participate in trading carbon allowances. The frenzy produced a rise of 10%—deemed the daily limit—within about 10 minutes of the launch.

While there are always issues to be worked out whenever a new market is launched, as far it goes, China Carbon market's first day was a huge success. Carbon allowances opened at 48 yuan ($7.42) a metric ton and traded as high as 52.80 yuan, limited by the defined max.

China's carbon prices may be starting low but it won't take long for them to exceed those of California's Cap & Trade system, where the price of carbon started at $12 in November 2014 and which grew a total of 40% over the subsequent five years. It then languished at around $17 from 2019 until May of this year, when it suddenly began to climb. This performance is an embarrassment and shows the power of the fossil fuel lobby in California throughout the last decade, since the price of buying CO2 hovers at around $150 on the commondity market. China's carbon market could theoretically exceed the price of carbon in California within a matter of weeks, even with a 10% daily cap.

We are encouraged by China's achievement and believe that they are moving along with an important tool to place the appropriate market signals on carbon emissions. It is not clear why Bloomberg feels the need to dis their efforts and diminish the importance of this launch but we believe this will light a fire under the U.S. to take more action, which may explain why the price of California's permits started showing some upward movement in price during the May auction.

Read Bloomberg Green's unsigned report, Top Carbon Market Launch Won't Help China Tame Emissions Yet," posted July 15, 2021.

Published by Nucleation Capital in Carbon emissions, Carbon markets, Climate change, Climate policy, Government support, History Timeline, History-making, LINKS

We need to cut greenhouse gas emissions in half by 2030, which will require an enormous transition in how we generate energy. While many people support renewables, they have little concept of how much land deploying renewables will require. For example, a 200-megawatt wind farm might require 19 square miles of land to replace a natural gas plant with the same generating capacity, that fits onto a single city block.

To fulfill President Biden's goal of an emission-free grid by 2035, the U.S. needs to increase its carbon-free capacity by at least 150%. Expanding wind and solar by 10% annually until 2030 would require a chunk of land equal to the state of South Dakota, according to Bloomberg and Princeton University estimates. By 2050, when Biden wants the entire economy to be carbon free, the U.S. will need up to four additional South Dakotas to develop enough clean power to run all the electric vehicles, factories and more.

To be clear, Biden’s plan doesn’t need to entirely rest on wind and solar. Nuclear energy, which requires far less space, is also emission free. Same for hydroelectric power. Plus, wind farms can be installed at sea. Solar panels work wonderfully on rooftops. And plenty of companies are placing bets that fossil-fuel plants can be retrofitted to burn hydrogen or equipped with systems to capture their carbon dioxide emissions.

Estimates vary widely on how much land the U.S. will need to satisfy Biden’s clean-energy ambitions but, regardless, the U.S. will need to rethink land use for an emissions-free future. This article provides some graphical illustrations of how researchers at Princeton University’s Net-Zero America project estimate it can be done and what the land implications of those pathways would be.

Read Dave Merrill's article and see his graphical analysis in "The U.S. Will Need a Lot of Land for a Zero-Carbon Economy," published by Bloomberg Green.

Published by Nucleation Capital in 100% Renewables, Advanced Nuclear, Carbon emissions, Climate change, Land Use by Energy, LINKS, Solving climate

China launches national carbon market

The Zero-Carbon Economy’s Possible Land Footprint