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Business leaders look to U.N. for deal toward carbon pricing

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October 26, 2021

By Ross Kerber and Simon Jessop

BOSTON/LONDON (Reuters) -World business leaders want the upcoming United Nations climate summit https://www.reuters.com/subjects/focus-climate-change to resolve issues that have so far hindered the use of carbon pricing to cut worldwide emissions, looking to boost the role that companies play in slowing global warming.

Executives, trade groups and policy experts say hopes for a deal are growing after negotiators at the 2019 summit in Madrid failed to settle how countries can account for international carbon trading as called for under Article 6 of the Paris climate agreement.

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A lack of international agreement has held back the development of systems for putting a price on carbon. Having some way to measure the economic cost of emissions https://www.reuters.com/business/cop/climate-change-what-are-economic-stakes-2021-10-25 is a top priority of companies across many industries whose leaders want to cut greenhouse gasses, said Rich Lesser, global chair of Boston Consulting Group.

For executives, “if you had a global price on carbon, then it would be economically rational to pursue solutions and alternatives”, Lesser said.

Dan Byers, who will represent major trade group the U.S. Chamber of Commerce at the summit in Glasgow https://www.reuters.com/business/environment/cop26-glasgow-who-is-going-who-is-not-2021-10-15, called the final resolution of Article 6 “long overdue” to resolve technical issues such as how countries can monitor and verify carbon emissions.

He added that a factor favoring a deal is the climate focus of U.S. President Joe Biden, who returned to the terms of the 2015 Paris climate agreement https://www.reuters.com/article/us-climate-change-usa/its-official-u-s-back-in-the-paris-climate-club-idUSKBN2AJ16T after predecessor Donald Trump pulled out of the accord.

“Having the Biden administration backing Paris, and at the table, is hugely important over the long run,” Byers said.

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Other issues that business leaders will track at the meeting starting Oct. 31 include what new pledges national leaders might make to cut emissions, and how much money will be set aside to finance sustainable development in emerging markets.

Carbon pricing plans can range widely including carbon taxes that charge companies for emissions, or emissions trading markets that cap how much companies or countries can emit but allow them to trade permits to exceed those levels.

Many corporations expect carbon pricing plans will help them fulfill the now widespread “Net Zero” pledges, said Kelley Kizzier, a vice-president at the Environmental Defense Fund, a Washington advocacy group, and a onetime co-chair of the negotiating group over Article 6 at previous climate summits.

Specific issues to resolve in Glasgow for Article 6 include how to prevent two countries counting the same emissions cut, and how new carbon markets might help fund developing countries’ efforts to adapt to climate change, she said. Even if a deal is reached, companies will still be left with the work of cutting their emissions, she added.

Just because a goal is set, “It’s not rainbows and butterflies,” Kizzier said.

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DIVISIONS REMAIN

Beyond carbon pricing, leaders are more divided on other topics that will be center stage in Glasgow such as the future role of fossil fuels in the world economy.

For instance, an investor group including PIMCO, State Street Corp and French asset manager Amundi has called on countries to take steps including raising their emissions-reduction commitments and ending fossil subsidies, and there have been separate calls for international banks to stop funding fossil fuel projects.

But energy executives say fossil fuels still have a role to play in the energy transition. New natural gas facilities in emerging markets would produce fewer emissions compared with existing coal-fired generation, said Aaron Padilla, a policy director for the American Petroleum Institute, whose members include big energy companies ExxonMobil Corp, Royal Dutch Shell and Norway’s Equinor.

“There’s still significant room for natural gas especially to displace coal as a source of production,” Padilla said.

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Financial companies face their own pressures. Companies with a combined $90 trillion in assets known as the Glasgow Financial Alliance for Net Zero have called for governments to set broad net-zero targets, for instance, and to price emissions.

But the group includes banks that still back fossil fuel projects, drawing criticism that they and the alliance’s chair, U.N. special envoy Mark Carney, are missing a chance to force harder action. Richard Brooks, climate finance director for the activist group Stand.earth https://www.stand.earth, said more should follow the example of France’s Banque Postale, which said it would stop serving the oil and gas sectors outright by 2030.

“Many of the banks who are part of the alliance are getting kudos and green cover but not changing their day-to-day financial practices,” Brooks said.

Asked about the criticism, Carney said in an emailed statement that member banks must set interim 2030 carbon reduction targets and decarbonization plans. “GFANZ has launched an ambitious body of work to accelerate implementation and action, which will be outlined at COP26,” he said.

(Reporting by Ross Kerber in Boston and by Simon Jessop in LondonEditing by Matthew Lewis)

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Canada’s Shopify records Black Friday sales up 21%

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November 27, 2021

(Reuters) – Canadian e-commerce company Shopify Inc recorded worldwide sales of nearly $2.9 billion on Black Friday, an increase of about 21% in comparison to last year, the company said Saturday.

New York, London and Los Angeles were among the top-selling cities, the company said, while apparel and accessories was the top-selling product category.

Shopify also said it funded 23,000+ tonnes of carbon removal to counteract emissions from the delivery of every order placed on its platform on Black Friday.

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(Reporting by Aakriti Bhalla in Bengaluru; Editing by Nick Zieminski)

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Xiaomi to open car plant in Beijing with annual output of 300,000 vehicles – Beijing govt

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November 27, 2021

SHANGHAI (Reuters) – Chinese smartphone giant Xiaomi Corp will build a plant that can produce 300,000 vehicles annually in Beijing for its electric vehicle unit, authorities in the capital said on Saturday.

The plant will be constructed in two phases and Xiaomi will also built its auto unit’s headquarters, sales and research offices in the Beijing Economic and Technological Development Zone, the government-backed economic development agency Beijing E-Town said on its official WeChat account.

Beijing E-Town said it anticipated the plant reaching mass production in 2024, a goal announced by Xiaomi’s Chief Executive Lei Jun in October.

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In March, Xiaomi said it would commit to investing $10 billion in a new electric car division over 10 years. The company completed the business registration of its EV unit in late August.

The company has been opening thousands of stores to spur domestic sales growth for its smartphone business but eventually intends to use these shops as a channel for its plans to sell electric vehicles.

(Reporting by Brenda Goh; Editing by William Mallard)

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Eni sells Snam 49.9% stake in Algeria gas pipelines for 385 million euros

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November 27, 2021

MILAN (Reuters) -Italian energy group Eni has agreed to sell gas group Snam 49.9% of its stake in strategic pipelines carrying Algerian gas into Italy for 385 million euros ($436 million), the two companies said on Saturday.

The pipelines will be jointly controlled by the two companies, they said in a joint statement.

Italy imports more than 90% of its overall gas needs and Algerian gas currently accounts for around 30% of flows.

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“This transaction allows us to free up new resources to be used on our energy transition path,” Eni Chief Executive Claudio Descalzi said.

Eni is working on spinning off a series of oil and gas operations into new joint ventures to help reduce debt and fund its shift to low-carbon energy.

Snam, which owns a 20% stake in the TAP pipeline that carries Azeri gas into Italy, makes most of its money from managing Italy’s gas transport grid.

It has pledged to spend more on new green business lines such as hydrogen and, like other gas grid operators in Europe, is upgrading its gas network to be hydrogen ready.

“In the future, North Africa could also become a hub for producing solar energy and green hydrogen,” Snam CEO Marco Alvera said.

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The pipeline companies involved in the deal posted net income of around 90 million euros in 2020.

($1 = 0.8836 euros)

(Reporting by Stephen Jewkes, editing by Giselda Vagnoni)

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