Tag: zero-emission vehicles

National Canadian Clean Fuel Standard to be Rolled Out Soon

The Clean Fuel Standard (CFS) is a proposed regulation under the Canadian Environmental Protection Act, 1999, which aims to reduce greenhouse gas (GHG) emissions by reducing the lifecycle carbon intensity (CI) of liquid fossil fuels used in Canada. While the initial scope of the CFS included liquid, gaseous and solid fuels, the scope of the CFS was narrowed under Canada’s latest climate change plan, A Healthy Environment and a Healthy Economy, to include only liquid fuels.

The objective of the CFS is to decrease the CI of liquid fuels approximately 13% by 2030. The proposed Clean Fuel Regulations (CFR, under the Canadian Environmental Protection Act, 1999) would establish annual lifecycle CI limits per type of liquid fossil fuel, expressed in grams of carbon dioxide equivalent per megajoule (gCO2e/MJ). The liquid fossil fuels that would be subject to the annual CI reduction requirement are gasoline, diesel, kerosene and light and heavy fuel oils. This obligation would be placed on primary suppliers (i.e. producers and importers) who domestically produce or import at least 400 cubic metres (m3) of liquid fossil fuel for use in Canada. Under the proposed CFR, primary suppliers would be required to reduce the CI of the liquid fossil fuels they produce in and import into Canada from 2016 CI levels by 2.4 grams of carbon dioxide equivalent per megajoule (gCO2e/MJ) in 2022, increasing to 12gCO2e/MJ in 2030, at a rate of 1.2 gCO2e/MJ per year. Reduction requirements for the years after 2030 would be held constant at 12 gCO2e/MJ, subject to a review of the regulations and future amendments.

The proposed CFR allows for flexible compliance options to enable primary suppliers to choose the lowest-cost compliance actions. Primary suppliers are required to satisfy their emission reduction requirements by creating or acquiring compliance credits. Primary suppliers can obtain compliance credits by:

1. undertaking activities that generate credits for its own account;
2. acquiring credits from others; or
3. paying into a compliance fund to acquire credits at a price of $350/tonne.

The proposed CFR would establish a credit market, where each credit would represent a lifecycle emission reduction of one tonne of CO2e. Parties that are not fossil fuel primary suppliers would be able to participate in the credit market as voluntary credit creators.

For each compliance period (typically a calendar year), a primary supplier would demonstrate compliance with their reduction requirement by creating credits or acquiring credits from other creators, and then using the required number of credits for compliance. Once a credit is used for compliance, it is retired and can no longer be used. For primary suppliers unable to satisfy their reduction requirement by June 30 following the end of a given compliance period, a market-clearing mechanism that facilitates credit acquisition by primary suppliers would also be available. The proposed CFR would set a maximum price for credits acquired, purchased or transferred in the credit clearance mechanism (CCM) at $300 in 2022 (CPI adjusted) per compliance credit. Where primary suppliers are unable to acquire sufficient compliance units through the CCM, they may carry forward up to 10% of their compliance obligation into subsequent compliance periods for up to two years. However, a 20% annual interest rate applies to amounts carried forward.

Compliance credits may be created by primary suppliers or voluntary credit creators who take one of the following actions:

1. Compliance Category 1: undertaking projects that reduce the lifecycle CI of fossil fuels;
2. Compliance Category 2: supplying low-CI fuels; or
3. Compliance Category 3: end-use fuel switching in transportation.

Environment and Climate Change Canada (ECCC) has identified four initial quantification methodologies for development in respect of Compliance Category 1, including: (i) carbon capture and storage (CCS); (ii) low-carbon intensity electricity generation; (iii) enhanced oil recovery; and (iv) co-processing of biocrudes in refineries and upgraders. In addition, a generic quantification methodology will be developed that can be utilized for activities which do not have their own bespoke quantification methodology, which will apply to such projects as energy efficiency, cogeneration, electrification and methane reductions. Project proponents would apply to ECCC to have a project recognized for credit creation and then submit an annual validation report with a third-party verification report and verification opinion. The credit period is 10 years with a possible five-year renewal for most projects, and a 20-year credit period and five-year renewal for CCS projects.

All low CI fuels supplied to the Canadian market, including fuels used to comply with existing federal and provincial renewable fuel regulatory requirements and British Columbia’s Renewable and Low Carbon Fuel Requirements Regulation, would be able to create credits under the proposed CFR.

To incentivize investments in low carbon fuels, the proposed CFR imposes limits on the proposed compliance options. These include a 10% limit of payment into the compliance fund mechanism, a 10% limit on the trading credits across fuel classes, and a 10% limit on carrying forward a credit obligation.

The CFR will retain the volumetric requirements under the existing federal Renewable Fuels Regulations (RFR) (5% low carbon fuel content in gasoline, 2% low carbon fuel content in diesel/fuel oil). This means that each primary supplier would be required to demonstrate for each compliance period that, of the total number of compliance credits it retires for compliance, a minimum (equivalent to 5% of its gasoline pool and 2% of its diesel and light fuel oil pool) is from low-CI fuels. These compliance credits are part of the total credits used to meet reduction requirements, but the same compliance credit cannot be used to meet the 5% and 2% requirements respectively. Prior to repeal of the RFR in 2024, companies will be entitled to rollover any existing compliance units and convert those units into credits recognized under the CFR.

The consultation period for the proposed CFR ended on March 4, 2021. Final regulations are expected to be published in the Canada Gazette, Part II in late 2021. Once the regulations are published, credit creators can register for and begin to create credits in the credit trading system. The CFR is expected to come into force on December 1, 2022.

News Round-Up from the Global Climate Action Summit & Call to Global Climate Action

From September 12 to 14, 2018, citizens, political and business leaders from around the world gathered in San Francisco for the Global Climate Action Summit to “Take Ambition to the Next Level.” The Summit represented not only an opportunity to celebrate the achievements of states, regions, cities, companies, investors and citizens with respect to climate action, but also served as a launch pad for deeper worldwide commitments and accelerated action from countries to achieve their commitments under the Paris Climate Agreement.

The Summit ended with delegates calling on national governments to join forces to step up climate action ahead of 2020 – the year when global greenhouse gases (GHG) need to peak and fall sharply thereafter to avoid the worst impacts of climate change. The meeting of leaders from states and regions, cities, business, investors and civil society at the Summit also underscored the transformational action they are already pursuing. For example, over 100 leaders are now committed to carbon neutrality, with the Governor of California bringing the date forward for California achieving this to 2045. Leaders also unveiled a range of bold new commitments across five specific challenge areas aimed at taking their collective ambition to the next level. These are aimed at avoiding risks and seizing the opportunities outlined in a suite of reports including the new Unlocking the Inclusive Growth Story of the 21st Century by the New Climate Economy.  The report finds that a stepped-up transition to a low-carbon economy can:

  • Result in $26 trillion in economic benefits worldwide through 2030.
  • Generate over 65 million new low-carbon jobs in 2030, equivalent to today’s entire workforces of the U.K. and Egypt combined.
  • Avoid over 700,000 premature deaths from air pollution in 2030.
  • Generate, through just subsidy reform and carbon pricing, an estimated US$2.8 trillion in government revenues per year in 2030, funds that can be used to invest in other public priorities or reduce distorting taxes.
  • By a shift to more sustainable forms of agriculture combined with strong forest protection, deliver potentially more than US $2 trillion per year of economic benefits, generating millions of jobs, improving food security—including by reducing food loss and waste—and delivering over a third of the climate change solution.
  • By restoring natural capital, especially our forests, degraded lands and coastal zones, strengthen our defenses and boost adaptation to climate impacts, from more extreme weather patterns to sea-level rise.

The announcements made during and prior to the Summit are aimed at meeting the goals under the Paris Climate Agreement. The following is an overview of the announcements made at the Summit:

Zero Emission Vehicles

  • An alliance of more than 60 state/regional, city governments and multinational businesses are now committed to a 100% zero emission targets through the ZEV Challenge.
  • 12 regions – including Catalonia, Lombardy, Scotland, and Washington State – representing over 80 million people and over 5% of global GDP will have 100% zero emission public fleets by 2030.
  • 26 cities with 140 million people are committed to buy only zero emission buses starting in 2025 and creating zero emission areas in their cities starting in 2030.
  • Business is stepping-forward with 23 multinational companies in EV100, with revenue of over US $470 billion, committed to taking fleets zero emission.
  • IKEA Group will transition to EV in Amsterdam, Los Angeles, New York, Paris, and Shanghai by 2020 – to reach 100% zero emissions for last mile home delivery.
  • More than 3.5 million additional zero emission vehicle charging points will be installed by 2025, and a goal for transport hydrogen to be zero-emissions by 2030 was launched.
  • Almost 400 global companies along with health care providers, cities, states and regions now have 100% renewable energy targets. This includes nearly 150 major global companies such as Tata Motors and Sony who have joined the RE100 initiative: collective annual revenues of these companies total well over US $2.75 trillion and their annual electricity demand is higher than that of Poland.
  • Over 30 energy intensive industry and property players have set smart energy and net zero carbon buildings targets through EP100.

Private Sector Initiatives

  • 488 companies from 38 countries have adopted emission reduction pathways in line with the science of the Paris Agreement – up nearly 40% from last year. Collectively, these companies represent US $10 trillion of the global economy, equivalent to the value of the NASDAQ stock exchange.
  • Nearly a fifth of Fortune Global 500 companies have now committed to set science-based emissions reduction targets including big emitters like India’s Dalmia Cement. Another example is Levi Strauss & Co, which has an approved Science Based Target for a 90% reduction in emissions in all owned-and-operated facilities and 40% reduction in its supply chain by 2025.
  • At the Summit, 21 companies announced the Step Up Declaration, a new alliance dedicated to harnessing the power of emerging technologies and the fourth industrial revolution to help reduce greenhouse gas emissions across all economic sectors and ensure a climate turning point by 2020. Signatories include several established climate leaders: Akamai Technologies, Arm, Autodesk, Bloomberg, BT, Cisco Systems, Ericsson, HP, Hewlett Packard Enterprise, Lyft, Nokia, Salesforce, Supermicro, Symantec, Tech Mahindra, Uber, Vigilent, VMware, WeWork, and Workday. Companies Autodesk, Safaricom and Unilever became the first to join a new Pledge for a Just Transition to Decent Jobs. They pledged to only buy from renewable energy providers that uphold fundamental workers’ rights including social protections and wage guarantees.

Sustainable Communities

  • Over 70 big cities – home to some 425 million citizens – are now committed to carbon neutrality by 2050, including Accra, Los Angeles, Tokyo and Mexico City. These actions will lead to a 2.5% cut of annual global GHG emissions and the avoidance of 12 billion tonnes of carbon dioxide equivalent by 2050. A further 9,100 cities representing 800 million citizens are now committed to city-wide climate action plans. This could lead to reductions of more than 60 billion tonnes of carbon dioxide equivalent between now and 2050.
  • Mayors of over 70 of the world’s key cities reaffirmed their commitment to delivering on the highest ambitions of the Paris Agreement, namely to keep a global temperature rise to below 1.5°C.

Land and Ocean Stewardship

  • A powerful Leaders Group and a new alliance linking over 100 NGOs, businesses, state and local governments, indigenous groups and local communities was launched to fire up action across the forest, food and land agendas.
  • Over 100 global supply chain actors (including supermarket chain Tesco and investors managing over US $5.6 trillion) pledged to work with a variety of organizations to halt deforestation and native vegetation loss in the Cerrado, Brazil.
  • Walmart announced a new platform to identify high-risk jurisdictions and source palm oil and paper and pulp from jurisdictions with no deforestation. Unilever – an anchor partner and supplier to Walmart – will support farmer certification as well as restoration in the Sugut, Kinabatangan and Tawau river basins in Sabah, Malaysia.
  • Through the Pacific Coast Collaborative, states and cities on the United States’ West Coast committed to reduce food loss and waste by 50% by 2030, a commitment with the potential to reduce 25 million tons of GHG emissions per year from the often-overlooked food sector.
  • The Global Environment Facility announced $500 million in funding to drive improved land use and forest conservation.
  • Nine of the world’s leading philanthropic foundations announced their intent to commit at least $459 million through 2022 to the protection, restoration and expansion of forests and lands worldwide—the announcement underlined indigenous peoples’ and traditional communities’ collective land rights and resource management.

Transformative Investments

  • The Investor Agenda was formally launched bringing together nearly 400 investors managing US $32 trillion of assets including CalPERS, the largest US pension fund; La Caisse de dépôt et placement du Québec (CPDQ), Danish pension fund PKA, and Sumitomo Mitsui Trust Asset Management. These investors are focused on accelerating and scaling-up financial flows into climate action and building a more sustainable, low-carbon, global economy.
  • CDPQ, Canada’s second largest pension fund has, for example, committed to increase its low-carbon investments by 50% by 2020, representing more than US$6.2 billion in new investment, and pledged to reduce the carbon intensity of its portfolio by 25% by 2025.
  • PKA, Denmark’s labor market pension fund manager, announced it plans to increase its investments in low-carbon climate solutions to 10 percent of its assets.
  • APG, the Dutch pension fund manager, announced it would no longer be investing in any coal related infrastructure going forward.
  • New York City announced it would be doubling its investments in clean energy and climate solutions to $4 billion over the next three years.
  • 296 investors have now joined Climate Action 100+ which is working with some of the highest emitting companies to assist them in lowering emissions, getting on track with clean energy and the goals of the Paris Agreement.
  • The Green Bond Pledge announced founding signatories including the City of Mexico, Luxembourg Green Exchange and SFPUC who join the state treasurers of California, New Mexico and Rhode Island; some major cities including the City of San Francisco; Australian pension fund LGS and two financial firms – together, this should spur the goal of seeing US $1 trillion-worth of green bonds issued by the end of 2020.
  • A Global Green Bond Partnership, (GGBP) backed by the World Bank, International Finance Corporation, Amundi and major climate finance and sustainability groups was launched with the aim of supporting and assisting sub-national and corporate green bond issuance.
  • 42 financial institutions gathered under the mainstreaming Climate Action in Financial Institutions initiative, representing over $13 trillion in assets, announced a commitment to helping cities, states, and regions finance climate action, including Multilateral Development Banks, members of the International Development Finance Club as well as leading private financial institutions from developing and developed countries.

Call to Global Climate Action

At the end of the Summit, delegates issued the following Call to Global Climate Action:

We, the people gathered at the Global Climate Action Summit, and communities around the world calling for climate action, commit to a climate-safe future for all.

The climate crisis calls for urgent action. We have seen the human impact on health, disease, famine, conflict, refugee crises, and livelihoods. We have seen thousands of people die each year from worsening storms and floods, heat waves, droughts, and wildfires. These impacts disproportionately affect the poor, disadvantaged, and vulnerable.

Now is the time for all leaders to step up and take bold action. Climate change is a threat to all humanity, and it can only be solved by a global cooperative effort. Only together will we transform our communities and energy systems, create employment opportunities and economic prosperity, protect our oceans and natural environment, and complete the transition to a zero-carbon world.

Under the Paris Agreement, the global community has agreed to confront the climate crisis by keeping the rise in global temperature well below 2 degrees C, and pursuing efforts to limit it to 1.5 degrees. 

Delivering this future requires collaborative and transformative action at all levels and in all sectors of society. Recognizing this imperative, over 500 commitments were made at the Global Climate Action Summit. Our continued global leadership includes: 

  • Over 100 Mayors, state and regional leaders, and CEOs have committed to become emissions neutral by 2050 at the latest and in line with the 1.5 degree goal of the Paris Agreement.
  • 488 businesses will set science-based targets to ensure that they are part of the climate solution.
  • More than 60 CEOs, state and regional leaders, and mayors are committed to delivering a 100% zero-emission transport future by 2030, putting us on an irreversible road towards decarbonization.
  • 38 cities, major businesses, state and regional governments have committed to net-zero carbon buildings, cutting emissions equivalent to more than 50 coal-fired power stations.
  • More than 100 indigenous groups, state and local governments, and businesses launched a forest, food and land-focused coalition to deliver 30% of climate solutions needed by 2030.
  • Nearly 400 investors, with $32 trillion under management, will work to ensure a low-carbon transformation of the global economy with the urgency required to meet the challenge.

We dedicate our actions, commitments and determination to give national leaders the confidence and assurance needed to increase their ambition and accelerate climate action by 2020 for the security of our planet, now and for generations to come. We call on the national governments of the world to: 

STEP-UP AMBITION NOW: Commit to increased climate ambition, including in the form of strong national policies and updated, enhanced Nationally Determined Contributions (NDCs) by 2020, consistent with what science tells us is needed to achieve the goals of the Paris Agreement;

CHART A CLEAR PATH TO YOUR ZERO-CARBON FUTURE: Develop net-zero mid-century emissions plans to inform future NDCs and to guide long-term economic and technological transformation that ensures decent jobs and increasing community resilience; 

EMPOWER BOTTOM-UP CLIMATE ACTION: Support and accelerate climate action at the local and regional level, with legislation, regulation, financing and policies that incentivize zero-carbon development, and through inclusive, transparent planning, dialogues and consultations that empower businesses, cities, states, investors, civil society, and individuals.

The whole world has to do more. Building on this positive wave of climate action, there are critical milestones for stepping up ambition by 2020, including the Talanoa Dialogue at COP 24 and the UN Secretary-General’s Climate Summit in 2019. By working together we can do more to transform our politics, our thinking, our values, and our way of life. It is up to all of us to roll back the forces of carbonization. Together we will rise and converge on a new climate-safe agenda for the world.

 

Washington State introduces Comprehensive Climate Change Initiatives

In December 2014, Washington State Governor Jay Inslee introduced an ambitious climate change policy agenda for 2015, including the establishment of an all-encompassing carbon pricing program. This policy follows the signing of Executive Order 14-04 (Washington Carbon Reduction and Clean Energy Action) by Governor Inslee on April 29, 2014, which set out a plan for state climate action.
If passed by state lawmakers, the program would raise an estimated $1 billion a year through a new levy on greenhouse gas emissions. In particular, the program would cap statewide pollution rates at levels that decline over time, with polluters allowed to trade state-sold pollution allowances among themselves. It would aim to address emissions covered other similar programs operating in the US, while avoiding pitfalls of other programs, such as giveaways for certain polluters. The technical aspects of Washington’s proposed program are considered best practices and as such, they have been lauded by outside observers such as the Environmental Defense Fund.
The program has been designed to help Washington get on track toward meeting its legislated goal of reducing emissions to 1990 levels by 2020, with a further 50% reduction by 2050. A November 2014 report by the Carbon Emissions Reduction Taskforce (which was established by Governor Inslee in April 2014 to provide recommendations on the design and implementation of a carbon emissions limits and market mechanisms program for Washington) concluded that Washington is not on target to comply with the 2008 law regarding required reductions in greenhouse gas pollution. It found that the requirement of reducing yearly pollution levels back to 1990 levels in 2020 would “likely” be met if a new cap and trade policy is implemented. Further steps would be needed to meet more ambitious reductions required by 2035 and 2050.
The proposed program would cover an estimated 85% of greenhouse gas emissions produced by Washington and it is anticipated that approximately 130 companies would be required to pay a levy, generating approximately $1 billion a year in revenue. Revenue generated under the cap-and-trade proposal would help to cover shortfalls in transportation and education spending, reduce taxes and fund household energy efficiency improvements for poorer residents, as well as help meeting the general costs of running the state.
Below is an overview of the legislative proposals aimed at reducing Washington’s greenhouse gas emissions:
• Carbon Pollution Accountability Act: The proposed Carbon Pollution Accountability Act (SB 5283 / HB 1314) would create a new market-based program that limits carbon emissions and requires regulated entities to pay for their emissions. The limit will decrease gradually over time, allowing emitters time to transition to cleaner technology and more efficient operations. The program will generate about $1 billion annually which will be used for transportation, education and disadvantaged communities. The draft Carbon Pollution Accountability Act can be found here.
• Clean Transportation: The Department of Transportation has three strategies to decrease transportation emissions: cleaner cars, cleaner fuels and moving people and goods more efficiently.
• Electric Vehicles (EVs): Legislation will extend tax incentives for EVs, create an EV infrastructure bank, and require urban cities and counties to adopt EV incentive programs. Draft legislation can be found below:
o Alternative Fuel Vehicle Sales Tax Exemption (SB 5445 / HB 1925): This bill extend a sales tax exemption on the first $60,000 on the purchase of alternative fuel vehicles.
o Electric Vehicle Infrastructure Carbon Pollution Accountability ActBank (SB 5444 / HB 1572): An EV bank would give financial assistance to install publicly accessible high-speed charging stations.
o Electric Vehicle Readiness in Buildings (SB 5446 / HB 1929): This bill would require urban cities and counties to adopt high speed EV charging station incentive programs.
• Zero Emission Vehicles (ZEVs): The Department of Ecology has requested legislation to allow Washington to adopt the Zero Emission Vehicle program.
• Clean Fuel Standard: The Department of Ecology is preparing a draft rule that outlines a clean fuel standard that would help the state to transition to cleaner fuels over time.
• Sustainable Transportation Planning: To reduce carbon pollution that comes from cars, trucks and other transportation-related sources, the Department of Transportation has developed a five-part action plan.

Public hearings on the proposed Carbon Pollution Accountability Act are continuing and have attracted great interest. Stay tuned for more details.

BC signs Climate Action Plan with California, Oregon and Washington

 
On October 28, 2013 the leaders of British Columbia, California, Oregon and Washington signed the Pacific Coast Action Plan on Climate and Energy committing their governments to a comprehensive and strategic alignment to combat climate change and promote clean energy. The region covered by the Action Plan has a combined population of 53 million people and a GDP of $2.8 trillion, which represents the world’s fifth largest economy.

Through the Action Plan, all four jurisdictions will account for the costs of carbon pollution and where feasible, link programs to create consistency and predictability across the region.  In addition, the Action Plan provides for the following actions:

  • harmonizing 2050 targets for greenhouse gas (GHG) reductions and developing mid-term targets needed to support long-term reduction goals;
  • cooperating with national and sub-national governments around the work to press for an international climate change agreement in 2015;
  • enlisting support for research on ocean acidification and taking action to combat it;
  • adopting and maintaining low carbon fuel standards in each jurisdiction;
  • taking action to expand the use of zero-emission vehicles, aiming for 10% of new vehicle purchases by 2016;
  • continue deployment of high-speed rail across the region;
  • supporting emerging markets and innovation for alternative fuels in commercial trucks, buses, rail, ports and marine transportation;
  • harmonizing standards to support energy efficiency on the way to “net zero” buildings;
  • supporting federal policy on regulating GHG emissions from power plants;
  • sponsoring pilot projects with local governments, state agencies and the West Coast Infrastructure Exchange to make infrastructure climate smart;
  • streamlining approval of renewable energy projects; and
  • supporting integration of the region’s electricity grids.

The Action Plan provides a much needed boost to regional and national efforts climate change policy efforts.

The Pacific Coast Collaborative was established in 2008 to address the unique and shared circumstances of the Pacific coastal areas and jurisdictions in North America by providing a formal framework for co-operative action, a forum for leadership and the sharing of information on best practices, and a common voice on issues facing coastal and Pacific jurisdictions.