Climate infrastructure stalls, earth is a water planet, and EU carbon border-tax looms

A newsletter for people "woke" on carbon and climate.

Issue No. 79

Welcome to the latest issue of Carbon Creed - a curated newsletter for people “woke” on carbon and climate. 

Message to Biden on infrastructure bill: no climate, no deal.

Progressives this week ramped up a pressure campaign on the White House to deliver on climate legislation, with several Democrats signaling they would not vote for an infrastructure bill absent significant provisions to slash greenhouse gas emissions.

Talks have entered a new phase on Capitol Hill after President Biden this week dropped negotiations with Sen. Shelley Moore Capito (R-W.Va.) and moved on to a bipartisan group of lawmakers that is crafting its own infrastructure proposal.

But any deal with Republicans, including the bipartisan negotiating group, is unlikely to include the kind of sweeping climate provisions Biden laid out in his initial $2.2 trillion-plus American Jobs Plan.

The progressive line in the sand could further complicate those conversations and offer a reminder to the White House that Sen. Joe Manchin (D-W.Va.) isn't the only swing vote in the 50-50 Senate.

Many Democrats view an infrastructure bill as the only game in town for tackling climate change, with appropriations and the midterm season creeping over the horizon.

So, can the Democrats craft a strategy to get their climate-infrastructure package across the finish line before midterm season? Probably.

Senate Majority Leader Chuck Schumer (D-N.Y.) said this week Congress could pass a bipartisan measure and a separate Democratic package through budget reconciliation, which allows certain bills to bypass the filibuster.

Certainly, never a dull moment in the nation’s capital. If you want to read more on this topic, I recommend visiting E&E News.

We’ll keep you posted on the latest carbon policy and market insights as they happen. 

If you have an opinion on any topic covered in this newsletter, please feel free to send me an email at mcleodwl@carboncreed.com. 

Thank you everyone for your kind thoughts and words of support last week - you’re the best.

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QUOTES

Climate quotes and sayings that will inspire you

(source: Science)

“Even if you never have the chance to see or touch the ocean, the ocean touches you with every breath you take, every drop of water you drink, every bite you consume. Everyone, everywhere is inextricably connected to and utterly dependent upon the existence of the sea.” ~ Dr. Sylvia Earle, oceanographer and author

Credo: Earth is a water planet, teaming with life. Climate change threatens our existence. WLM

“I do not feel obliged to believe that the same God who has endowed us with sense, reason, and intellect has intended us to forgo their use.” ~Galileo Galilei, astronomer and engineer

Credo: Faith and reason when applied to climate change, need not conflict. WLM

“One day of rain far surpasses a whole year of drought.” ~Malawian Proverb 


BOOKS

(source: Amazon)

Iwigara: The Kinship of Plants and People

Written by Enrique Salmón

The belief that all life-forms are inter-connected and share the same breath – known in the Rarámuri tribe as iwígara – has resulted in a treasury of knowledge about the natural world, passed down for millennia by native cultures. Ethnobotanist Enrique Salmón builds on this concept of connection and highlights 80 plants revered by North America’s indigenous peoples. Salmón teaches us the ways plants are used as food and medicine, the details of their identification and harvest, their important health benefits, plus their role in traditional stories and myths. Discover in these pages how the timeless wisdom of iwígara can enhance your own kinship with the natural world. Tap into thousands of years of plant knowledge.


Creed Comments: Iwígara, when translated, means “the kinship of plants and people.” And that is exactly what Enrique Salmón explores in this important book. Recently, I have been discovering the wisdom of native people and their understanding of the land and climate. I am adding this rich book to my summer reading list - why not join me.


INSIGHTS

(source: BBC)

EU carbon border tax plan looms over G7 meetings

Europe is preparing legislation that would jolt the rules of international trade by taxing imported goods based on the greenhouse gases emitted to make them, a plan that has sent shudders through the world’s supply chains and unsettled big trading partners such as the U.S., Russia and China.

The European Union plan, due to be announced next month, generated debate at a summit of the leaders of the Group of Seven rich countries in southwestern England, where the international response to climate change is a central topic.

The EU proposal would open up a new front in the fight against climate change by setting the world’s first limits on carbon in traded goods. The 27-nation bloc says it wants to stop polluting industries from shifting production outside Europe to avoid the bloc’s emissions limits and then exporting back into the EU. The proposal would also use the EU’s economic heft to send a powerful signal for other countries to start regulating carbon emissions.

How would the EU carbon border tax work?

The EU proposal would require European importers to buy certificates that would cover the carbon content of their imports in certain sectors, according to a draft of the legislation reviewed by The Wall Street Journal. At first, the rules would apply to four heavily polluting industries: steel, aluminum, cement and fertilizer, the draft says. Other industries would be included over time. The draft says the rules could come into effect during a transitional period starting as early as 2023 and be fully in force in 2025, though officials say those dates could change in the final proposal.

The proposal would establish a new agency to enforce the rules and certify private companies that importers would need to hire to calculate the carbon content of goods produced overseas. Importers of goods covered by the levy—called a carbon border adjustment mechanism—would need to be authorized by the new agency, according to the draft proposal. Officials say the legislation would create a big new market for firms with the expertise to calculate the so-called carbon content of imports.

The European Commission, the EU’s executive arm, is drafting the legislation, which must then be approved by the bloc’s national governments and the European Parliament. The idea already has broad political support across the bloc: EU member states endorsed it at a summit last year and the Parliament did so this year.

How much will it cost?

The draft legislation proposes charging a carbon price based on the EU’s emissions-allowance market, which regulates EU power plants and factories. That price, which would be applied to each ton of carbon dioxide emitted to make an imported good, has soared to more than 50 euros a metric ton of carbon dioxide, equivalent to $56, from around €30 at the beginning of the year, as traders anticipate that the bloc later this year will move to ratchet down emissions caps.

EU officials say that applying the same price to carbon dioxide emitted inside and outside the bloc means the system complies with World Trade Organization rules that forbid governments from discriminating against foreign companies.

Importers that source goods from the few countries that already set an explicit price on carbon emissions would be able to deduct those costs from the proposed import tax, according to the draft proposal. That provision could be a problem for manufacturers in the U.S., which hasn’t passed a nationwide carbon pricing system.

[This post was adapted from the original story written by Matthew Dalton for The Wall Street Journal]


Creed Comments: I have written at length about my support for pricing carbon emissions. An EU border tax will force the issue globally, and the U.S. will have to comply or resist. My take - there will be a price on carbon in the U.S.


RESOURCES


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