In a series of prior blog posts, we previously highlighted the historic implications of the Inflation Reduction Act (IRA) for the U.S.'s international climate commitments, as well as for private companies navigating the energy transition. Shortly after our series published, the Senate passed the IRA on Sunday August 7th with only minor modifications to the bill's $369 billion in climate and clean energy spending. Today, the House passed the IRA without any further changes, and soon hereafter President Biden is expected to sign it into law.
However, this is only the beginning of the road!IRA四角将产生广度效果。 未来数月和数年中,我们期望看到对机构规则的强力操纵将决定IRA实施,并判定它作为能源策略的最终成功
As an initial matter, it seems Congress has not finished its work revamping the nation's climate and energy laws. As part of his agreement to support the IRA, Senator Joe Manchin (D-WV) announced that "President Biden, Leader Schumer and Speaker Pelosi have committed to advancing a suite of commonsense permitting reforms this fall that will ensure all energy infrastructure, from transmission to pipelines and export facilities, can be efficiently and responsibly built to deliver energy safely around the country and to our allies." While the exact contours of this legislation are not currently known, Senator Manchin's office recently released a legislative framework, which includes proposals to, among other things:
According to Senator Manchin's office, permitting reform will receive a vote before the end of the fiscal year on September 30, 2022. Unlike the Inflation Reduction Act, which passed through arcane rules of reconciliation—and thus required only a simple majority—permitting reform will be subject to the Senate filibuster and require the support of at least 60 senators (and bipartisan agreement) to become law. At the moment, it is unclear whether broad bipartisan support exists for this measure!some Republicans have publicly signaled skepticism, and environmental activists have long opposed expedited fossil fuel permitting.However, in the past Republican Senators have expressed an interest in speeding the nation's permitting system. During this Congress, a bipartisan group of Senators introduced a law to accelerate infrastructure permitting, and all Republicans and Senator Manchin supported a resolution to disapprove of recent revisions to NEPA. Together, these actions suggest there may be some interest within the Republican caucus in implementing meaningful changes to current law, partisan divisions notwithstanding.
外加,IRA本身有几部分未来数月将通过行政引导和规则制定过程予以澄清和实施守法标准支付工资、学徒和家用内容要求并计算温室气体排放法新税抵免 。
ahrfss/www.insideEnergyandense.com/2022/07/enger-support-for-电机-车-车-车-门-电-电-电-电-电-电-电-电-电-电-电-电-电-电-电-电-电-电-电-电链/>这些规定并不适用于商业电车信用分量 。 具体地说,法律要求电电池组件的一定比例为“制造或组装北美 ”, 并适用百分比逐年变化 。 法律还要求电池中关键矿产品中一定比例为“提取或处理 ”, 在美国或与美国相邻的任何国家中实现“提取或处理 ” 。IRA § 13401(e).鉴于电车供应链的现状,预计许多汽车制造商难以满足这些外包需求万博体育app手机登录
However, key features of these clean vehicle credits have yet to take shape. By the end of this year, the IRA requires the Treasury Department to issue regulatory guidance to help shape and administer the battery and mineral sourcing requirements. Id. Among the questions open for interpretation are acceptable methods for calculating the "percentage of the value" for critical mineral and battery components, as well as better defining the terms "manufacture or assembly" and "extraction or processing." How Treasury addresses these points will have significant ramifications for the short- and medium- term value of the clean vehicle credits.
A much broader set of IRA tax credits seek to promote investment in, and use of, clean electricity, but their value depends on the interpretation of key labor and domestic content requirements. As currently structured, the IRA extends and modifies the Investment Tax Credit and Production Tax Credits that apply to certain renewable sources of power through the end of 2024. Id. §§ 13101, 13102. Beginning in 2025, similar projects will also be eligible for a new technology-neutral Clean Electricity Production Credit and a Clean Electricity Investment Credit, which apply to any domestically produced electricity source with a greenhouse gas emissions rate of zero. Id. §§ 13701, 13702. These credits, and others throughout the IRA, are keyed to the satisfaction of prevailing wage and apprenticeship requirements.
Specifically, if these wage and apprenticeship requirements are not satisfied the credits are worth five times less than they otherwise would be. Additionally, the IRA creates a 10% "domestic content bonus" when facilities certify that certain percentages of steel, iron, and other manufactured products used in the facility are made in America, and further increases the value of the credit for projects located in "energy communities," i.e.棕田网站或经济困境前化石燃料生产网站解释应用将极大影响政府可用支持值。 未来清洁能源项目必须注意确保适当文档并遵守这些条款Finally, many IRA tax credits are pegged to a demonstration of the life-cycle emissions of the underlying facility or fuel. For instance, the value of the clean hydrogen credit varies based on the project's "lifecycle greenhouse gas emissions rate." On the high end, a 100% credit value is awarded to projects with a lifecycle emissions rate of less than .45 kilograms (kgs) of carbon dioxide equivalent (CO2e), but on the low end, projects only receive 20% of the credit value if their emissions rate is between 4 and 2.5 kgs of CO2e. Id. § 13204. Additionally, the availability of the new credit for sustainable aviation fuels depends on a certification that the applicable fuels achieve at least a 50% life cycle greenhouse gas reduction percentage compared to petroleum-based jet fuel!燃料项目再为生命周期温室气体排放量增量百分比增量增益Id.
The full implications of the IRA are yet to be understood. The law is likely to have significant implications for our energy future, leading to sharp growth in the nation's clean energy production and a decline in national greenhouse gas emissions. Though we have laid out some initial consequences, there are undoubtedly many more interpretive questions that will arise in the coming weeks, months, and years. Additionally, by subsidizing and lowering the costs of clean electricity and other low-emissions technology, the IRA could improve the benefit-cost analysis for a variety of environmental regulations, leading to more stringent and durable rules. Further, by bolstering the domestic energy industry, the IRA could alter the political economy of climate policy, creating a broader base of support for future government investments in clean energy production or greenhouse gas curtailment. Regardless of how this future unfolds, it will surely be a dynamic time for energy and environmental law and policy.
通缩法(IRA)将大步限制并减少甲烷污染甲烷证明是气候问题的重要部分ips/unep.org/news-andssories/story/are-raistriew-climate-heres-show-redues-thes#:~Text=me%20is%20By implementing a Methane Emissions Reduction Program, the IRA takes a significant step towards reducing methane-related warming. This program implements a carrot-and-stick regulatory regime, whereby the Environmental Protection Agency (EPA) rewards methane reduction efforts with financial assistance, and penalizes excess methane waste with a set fee.
The IRA is the latest in a series of efforts by the United States to reduce methane emissions from the petroleum and natural gas sectors. Since taking office, the Biden Administration has recognized the challenges posed by methane emissions and prioritized cutting their emissions. In advance of the 2021 UN Climate Change Conference in Glasgow (COP 26), the United States and the European Union jointly launched the Global Methane Pledge, which asked countries to band together and commit to a collective goal of reducing global methane emissions at least 30% from 2020 levels by 2030. As of this summer, the State Department has announced that 120 countries have joined the pledge. In November of 2021, the Biden Administration further announced a series of regulatory actions to tackle methane emissions, from the oil and gas sector, landfills, abandoned coal mines, and agriculture.
The Methane Emissions Reduction Program complements each of these efforts and is the next significant step in the country's attempt to tackle methane-related warming. It would reduce methane emissions through two key mechanisms. IRA § 60113.First, it would provide $1.5 billion for EPA to support emissions monitoring and methane reduction efforts in petroleum and natural gas systems, through grants, rebates, contracts, loans and other forms of financial support. Id. These funds are directed at permanently shutting in and plugging wells on non-federal lands, to improving and deploying equipment that reduces methane emissions, and to supporting innovation in reducing methane emissions. Id.
Second, these incentives are coupled with a methane waste emissions fee applied to petroleum and natural gas systems emitting more than 25,000 metric tons of carbon dioxide equivalent gas. The fee will be calculated by multiplying the metric tons of methane emissions exceeding waste emissions thresholds by: (a) $900 for emissions in 2024!2025年排放1200元and (c) $1,500 for emissions in 2026 and each year thereafter. Id. Fees will only be imposed on emissions above a certain waste emissions threshold, which vary by industry segment and represent the leakage rate from well-designed and maintained systems in that segment, in turn providing an incentive for oil and gas systems to reduce methane leakage.
The Methane Emissions Reduction Program further promotes EPA's regulatory authority under the Clean Air Act, by exempting from the payment requirement any facilities that are in compliance with methane emissions requirements established for new and existing sources, so long as standards and plans have been approved and are in effect in all States and compliance with the requirements imposed by those standards and plans will result in equivalent or greater emissions reductions than can be achieved by EPA's November 2021 proposed rule to reduce methane in the oil and natural gas industry. This is a powerful floor!EPAss/www.epa.gov/system/files/documents/2021-11/2021-oil-and-gas-subject.-overview-fact-she..大于2019年全美释放的二氧化碳量passenger cars and commercial aircraft combined." By imposing a tax on emitters that are lagging behind and providing an exemption once all States are enforcing requirements that would achieve equivalent or greater reductions, the IRA's Methane Emissions Reduction Program creates strong incentives for both States and industry to adopt and comply with strong methane emissions standards.
As noted in another blog post, the Rhodium Group has estimated the IRA, if enacted, would cut domestic greenhouse emissions 44% from 2005 levels. In an earlier study of the emissions reductions associated with a prior iteration of the IRA, Rhodium described the methane emissions fee as one of six "big-ticket items that stand out" for its impact on reducing emissions. That the Methane Emissions Reduction Program is just one of many, game-changing provisions in the IRA underscores the potential impact of this bill for the energy sector and for achieving our nation's climate objectives.
援救市场失效阻碍实现足够程度的环境保护或高效内部能源市场援助的适当性,即目标是否无法通过替代措施实现(充分)基于市场工具,如排放交易机制或偏差性小辅助工具(例如可偿还预付直接授标援助的相称性,即援助是否限为最小需求, 即实现援助量度目标所需净额外成本透明性援助,即或公诸于世(v) the avoidance of undue negative effects of the aid on competition and trade, considering the distortive effects on competitors that likewise operate on an environmentally-friendly basis, and it will (vi) weigh up the positive and negative effects of the aid, paying attention to the sustainability of the activity and in particular that it ‘does no significant harm' to environmental objectives.
These assessment criteria are further elaborated for each specific category of aid.
Categories of aid that can be assessed under the CEEAG
Most of the categories of environmental protection and energy measures falling in the scope of the previous EEAG are covered by the CEEAG in a much larger fashion.These categories relate to support:
The CEEAG further extends the list of measures that can be aided to support:
Whereas previously investment aid for large airports (more than 5 million passengers per year) could only be authorised in exceptional circumstances, such as relocation of an existing airport, aid for large airports would now be authorised also where the purpose of the aid is to improve environmental protection.
Nuclear energy remains outside the scope of the CEEAG, because it relates to limited but very large projects, subject to the EURATOM Treaty.核电援助直接依据条约条款评估 。
Covington团队将继续监控开发并随时更新
As the United Nations Climate Change Conference of the Parties ("COP") in Glasgow has drawn to a close, with seemingly mixed messages and a somewhat ambiguous conclusion, it is worth reflecting on the overall trajectory of the climate issue, societal expectations, and the accomplishments that — with time — Glasgow is likely to represent. COP26 highlighted the fragility of the planet, as well as the fragility of the global consensus-based United Nations approach to protecting it. It highlighted the sweep of global climate-induced challenges and the scale of transformation needed to address them. With rising temperatures has come a rising global focus on climate and a far greater set of emerging societal expectations for meaningful responses by government and the private sector. Despite the risk that the global agreement forged in Glasgow is seen by climate activists as all talk and no action — what they referred to as "blah, blah, blah" — I believe that a number of features will endure as important accomplishments.
Representatives from 197 nations, businesses, hundreds of civil society organizations, scientists, educators, media, and climate activists — you name it — all converged on Glasgow to shine a global spotlight on the climate crisis. The Conference had some 40,000 registered participants. With just a few thousand of those involved in the negotiations themselves, the rest converged around elevating climate understanding, climate solutions, and climate action. And still tens of thousands of others converged to protest and lend their voices to the climate debate.期望因Covid-19延迟一年以及美国返回巴黎气候进程而提高但这些期望都集中在依赖实现每一项结果一致性的联合国谈判进程上 。
尽管Covid云下集合和大批与会者所构成挑战,但缔约方会议在某些方面组织得比以往更好。它不再完全是一个国际谈判,而更多地是一个通信机制,以凝聚世界对雄心气候行动需求的看法United Nations进程启动全球领导人峰会,有120位国家元首参加It featured inspiring statements from governmental and societal leaders, such as Sir David Attenborough. The Summit then flowed into the overall COP, which had a thematic organization for each day of the conference, by which it highlighted actions or the sweep and scale of climate impacts in a more coherent fashion than ever before — spanning from energy, finance, transport, cities and the built environment, science and innovation, nature, gender, youth, and adaptation to and loss and damage from climate change. And the overall gathering encapsulated a heightened global focus on climate as a defining generational issue in a way that has never happened before.
The World Rallied Around the Urgency Shown By the Evolving Climate Science
The defining element of the Glasgow considerations was the acceptance of a far sharper sense of climate science findings around the scale and urgency of emissions reductions needed to stabilize the earth's climate and prevent catastrophic consequences. Every aspect of the discussions was judged by the context the new climate science shows.
Leading up to the COP, the UN's authoritative science body, the Intergovernmental Panel on Climate Change ("IPCC"), had issued two reports — one in 2018 focused on the imperative of holding global average temperature rise to 1.5 degrees Centigrade, and one in the Summer of 2021 highlighting the "overwhelming" evidence of climate change. The reports showed that a rise in global temperature to 2 degrees would lead to catastrophic results in both the frequency and severity of climate-induced events and global changes. The reports found the science of human-induced impacts "unequivocal" and noted that global temperatures had already risen by 1.1 degrees over pre-industrial levels — demonstrating how limited the remaining carbon budget is — and that climate adverse effects were widespread, rapid, and intensifying.The report further found that urgent action is needed to cut emissions by 45% by 2030 and achieve net zero emissions by 2050 in order to maintain a sustainable trajectory.
The IPCC findings were characterized by UN Secretary General António Guterres as a "code red for humanity." They became the touchstone for judging the adequacy of country pledges and private sector net zero commitments. In addition to the scale of the emissions reductions, the need for an accelerated pace of change also became far clearer and a widely accepted expectation. The notion that we are now in a "decisive decade" to get on the right emissions trajectory was embraced by the COP process. Going into the COP, various assessments, such as from the International Energy Agency, showed that existing country emissions reduction commitments would lead to a global temperature rise of 2.8 degrees by the end of the century. Those pledges covered less than 20 per cent of the gap in emissions reductions needed to be closed by 2030 to keep a 1.5 degree path within reach. According to a number of projections, the plethora of new commitments announced at the COP would, if delivered in full, lower the rise to somewhere between 1.8 and 1.9 degrees. The UN noted that the actual nationally determined contributions ("NDCs") submitted by participating nations would result in an unsustainable global temperature rise of 2.4 degrees.
At the end of the day, the overall agreement reached by 197 countries — including new emissions reductions announcements, the move to more regular revision of national commitments, transparency requirements around that process, and the development of rules for the global carbon markets — at bottom kept alive the possibility of limiting global temperature rise to 1.5 degrees by the end of the century and essentially transformed that temperature target into the new object of the UN process.虽然1.8度和1.5度之间的差值似乎不大,但实际上它代表着减轻气候变化最大破坏性影响的实质性差值。 广泛报道的争议涉及是否逐步停用煤炭和化石燃料补贴,发展中国家是否有足够的气候资金,以及是否向受影响国家提供补偿“损耗和损害”抑制了对协议的热度。 尽管如此,正如缔约方会议主席Alok Sharma得出的结论, “我们现在可以可信地说我们已经保住1.5度。But, its pulse is weak and it will only survive if we keep our promises and translate commitments into rapid action."
Paired with these science targets was a far more prominent voice given to the moral underpinnings to the proceedings that focused on the inequity created because the most vulnerable nations to climate impacts are those who have contributed least to the emissions causing such impacts, and a palpable sense of obligation to future generations. The IPCC report drove home the concept that the COP process is not some future exercise with distant impacts, but that the delegates were poised to address an urgent crisis of the here and now.
The Paris Climate Framework Survived the Absence, and Accommodated the Return, of the United States as an Active Participant
The nations of the world remained committed to the UN Climate Framework Convention's goal of "the stabilization of greenhouse gas concentrations in the atmosphere at a level that would prevent dangerous anthropogenic interference with the climate system" even in the absence of U.S.巴黎气候协议自下而上承诺框架由每个国家根据自身环境确定,体现了应对这一全球挑战的共同全球承诺,没有美国则保持稳定和适切性participation, and the reaffirmation of that framework may be one of Glasgow's greatest accomplishments.
The Paris balance had achieved a "bottom-up" system of emissions reduction commitments that flexibly accommodates the circumstances of individual countries, yet one that does not allow so much flexibility that there is no realistic hope of actually bettering the climate situation by addressing emissions mitigation, adaptation to the already locked-in effects of climate change, and assistance for climate-impacted developing nations. Paris provided a solution and a directional sense of its goals, even as it admitted that its trajectory may need to grow more stringent over time, informed by meaningful science. Glasgow refined that process with a commitment by the parties to revisit their NDCs in one year rather than five and with enhanced transparency around individual country goals and their implementation. This process preserves the possibility that the collective emissions reduction actions are calibrated to avoid the worst climatic impacts.
The durability of the Paris structure was aided, to be sure, by the promise of new technology, which could allow for countries to enhance their emission reduction commitments through cost effective wind, solar, energy efficiency, and electric vehicle technologies — technologies that were still only on the verge in Paris — making a clean energy transformation that is consistent with the Paris climate goals today seem like an attainable objective.
When the United States did return to the negotiating table, it brought with it an ambitious NDC — pledging to achieve a 50-52 percent reduction from 2005 levels in economy-wide net greenhouse gas pollution by 2030, to achieve 100 percent carbon pollution-free electricity by 2035, and net zero emissions no later than 2050. It also brought a bevy of other actions to instill more confidence in its commitment.This included leadership in assembling a global methane reduction coalition by which more than 100 countries agreed to cut emissions to tackle this highly potent short-acting greenhouse gas by 2030, a "first movers" technology coalition, as well as a series of whole-of-government financial and regulatory initiatives.
While the Biden Administration would have liked to have had its actions backed up by climate legislation, particularly power plant incentives and a range of clean energy tax credits in the reconciliation bill, it made a strong case nonetheless about the comprehensive approach it is taking to prioritizing climate outcomes across the government, whether that be in the financial sector, energy, or transportation. And the United States demonstrated ambition in its diplomacy, reaching a surprise commitment with China to work collaboratively across a range of areas to keep alive the prospects for achieving 1.5 degrees. President Biden's address to the COP was complemented by a widely praised speech by former President Obama speaking directly to youth climate activists who had taken to the streets during the COP, as well as by Congressional leadership.
The Global Focus on the Climate Crisis Puts a New Spotlight on the Importance of Business Solutions and the Business Opportunities Around Climate — Subject to Ever Greater and More Intensive Scrutiny
The first week of the COP brought a breathtaking series of collaborative public and private sector announcements to achieve carbon emissions reductions. In many ways, these commitments seem almost as significant in accomplishing a clean energy transformation as the text of the UN agreement itself.
In addition to the methane pledge, leaders from over 120 countries, representing about 90 percent of the world's forests, pledged to halt and reverse deforestation by 2030. Hundreds of financial firms, operating through the Glasgow Financial Alliance for Net Zero (GFANZ), committed over $130 trillion of private capital — representing 40 percent of global financial assets — to transforming the economy for net zero.Various combinations of development organizations and private sector capabilities identified a range of opportunities they will pursue for investments in particular developing nation economies, such as in efforts to stem coal use in South Africa. Nearly 30 national governments, joined by cities, states, major automotive manufacturers, fleet owners, and investors, signed the Glasgow Declaration on Zero-Emission Cars and Vans to end the sale of internal combustion engines by 2035 in leading markets, and by 2040 worldwide. Other transportation commitments touched on heavy duty vehicle electrification, green shipping, and enhancing the deployment of sustainable aviation fuels.
Glasgow in many ways represents a shift in focus from a governmental initiative to a recognition that the scale and pace of the energy and societal transformation and response demanded by climate change necessarily will require swift and credible action by the private sector as well. As one Chief Executive Officer put it, the concept of a "climate-advantaged" company has taken hold, where sustainability has been transformed from a "nice to have" effort being done on the side, to a vital consideration at the center of business strategy, and where such companies can benefit from a substantial value premium. As one of the UN's High Level Climate Champions put it: "Net zero has gone from extreme to mainstream."
Of course, with the proliferation of net zero pledges comes an increasing level of skepticism about the credibility of those commitments and the ability to deliver on them in the long run. In the ramp up to the COP, the IPCC focus on the more stringent and nearer term emissions reductions meant that the Science Based Targets Initiative formally revised its goals for net zero corporate commitments to align with the new 1.5 degree IPCC target and issued a new standard for evaluating company emission reduction offerings. Along these same lines, the so-called "Under 2 Coalition," representing commitments by some 60 percent of world's economy, is recasting itself as the "Net Zero Coalition."
Likewise, the UN Secretary General, at the Opening to the World Leaders Summit portion of the COP and prompted by developing nation and activist concerns over the credibility of emissions reduction commitments, characterized "a deficit of credibility and a surplus of confusion over emissions reductions and net zero targets, with different meanings and different metrics." The Secretary General therefore announced that he will "establish a Group of Experts to propose clear standards to measure and analyze net zero commitments from non-state actors." The Secretary General reiterated his intent to establish a high level group for this purpose at the conclusion of the COP as well. These will likely complement a range of emerging national financial sector and ESG transparency requirements, including the announcement of the formation of a new International Sustainability Standards Board, along with other Paris Climate Agreement provisions, particularly the new carbon market rules.
Indeed, youth activists expressed particular concern over the pace and credibility of emissions reduction commitments, stating quite simply that "we don't believe you" and urging the business community to "prove them wrong." This skepticism was heightened by the overall context of the final COP debate around the failure to honor in a timely way climate finance commitments of $100 billion per year to affected developing countries, the absence of a clear loss and damage compensation commitment, and the somewhat relaxed treatment of fossil fuels, particularly the insistence by some nations to preserve an ongoing role for coal.
Just as there will be these formal processes to help refine net zero expectations, there no doubt also will be enhanced activist group scrutiny of company pledges and climate impacts. Companies will be called to task to demonstrate what they are doing to implement their net zero commitments.This scrutiny is likely to be even more acute given the inability of the formal negotiating process to achieve a level of ambition through country NDCs that will reach the 1.5 degree target or deliver in the short term the climate finance commitments for the developing world and the credibility gap that this outcome may perpetuate. As France's former Climate Ambassador and the key architect of the Paris Climate Agreement, Laurence Tubiana, put it, "Greenwashing is the new climate denial." Climate accountability in many ways will be the new currency.
We Can Expect More Focus on Climate Commitments Going Forward
Building on the Paris accord, the agreement follows the pattern of existing domestic environmental laws in recognizing that it may not be a perfect solution, in and of itself, and that the science will continue to evolve.But those frameworks recognize that it is critical to get started on the emissions reduction process even if the target may be revised in the future. Similar to the Clean Air Act's five year review provision for fundamental health-based pollutants, Glasgow acknowledges the need to calibrate future emissions reductions based on new science more frequently and with greater transparency to assess the success of country measures in meeting the emissions targets, and that there is a fierce urgency of the now being expressed by climate advocates that should inform those evaluations. While the global community has demonstrated that it can, in essence, walk and chew gum at the same time, the question this time is whether it can do so while running.That will be tested starting next year with submissions to the next COP.
Implementation of the various COP26 pledges will be a critical piece of the equation. The test will continue to be how to turn commitments into action for this decade. As the UN Secretary General indicated, "COP27 begins today." In some ways, Glasgow represents a sharper focus on science-aligned plans — by governments and business and in the face of a new global climate consciousness — to maintain climate stability, and the focus will now shift to the implementation and refinement of those commitments. For companies, growing global climate consciousness and risks and opportunities posed by the energy transformation present a new post-Glasgow dynamic necessitating climate engagement, but requiring a credible approach in doing so.
The focus is on domestically-generated renewable electricity to create a power system based on a mix of renewables, new nuclear power stations, flexible storage, gas with CCS and hydrogen.
Specifically, the NZS undertakes to:
2) Fuel Supply & Hydrogen
The NZS re-states the ambition that the UK will deliver 5 GW of hydrogen production capacity by 2030. The UK will at the same time halve emissions from oil and gas and increase the production of biofuels.
Specifically, the NZS undertakes to:
3) Industry
The NZS commits the UK to creating four carbon capture usage and storage (CCUS) clusters by 2030. The UK will support a ‘deep decarbonisation of industry' through carbon pricing and the creation of low carbon industry clusters, which would have access to Government support under the CCS Infrastructure Fund and revenue support mechanisms.
Specifically, the NZS undertakes to:
4) Heat and Buildings
The NZS creates a pathway to ensuring that from 2035 all new heating appliances in homes and workplaces are low carbon and sets 2026 as the date for a decision on the role of hydrogen in heating.The Government will seek to reduce electricity costs and to rebalance energy levies (such as RO and FiTs) and obligations (such as ECO) away from electricity to gas.
Specifically, the NZS undertakes to:
5) Transport
The NZS aims to remove all road emissions and begin work to deliver zero emission international travel including through new vehicle grants and investment in electric vehicle infrastructure!and to increase use of public transport, cycling and walking.
Specifically, the NZS undertakes to:
6) Natural Resources, waste and fluorinated gases
The NZS sets out the Government's ambition to increase woodland creation in England to meet the UK's overall target of planting rates to 30,000 hectares per year by the next election.NZS旨在鼓励农民实施低碳耕作法,包括通过农林业The NZS sets out the UK's ambition to encourage a circular economy and continue to phase out the use of F-gases.
Specifically, the NZS undertakes to:
7) Greenhouse Gas Removals
The NZS sets out the UK's ambition to deploy at least 5 MtCO2/year of engineered GGRs by 2030 through Government support to early commercial deployment of GGRs, with an ambition to move towards a market-based framework for GGRs.
Specifically, the NZS undertakes to:
8) Support the transition with cross-cutting action
The NZS sets out the UK's intention to use its status as COP26 host nation to encourage other countries to get to net-zero by 2050, and set more ambitious interim emissions reduction targets.NZS鼓励私营部门提供绿色金融并设定政策意图使选择绿色选项对消费者更容易和便宜The NZS aims to support training and skills including through a focus on local solutions and undertakes to embed climate into all Governmental policy and spending decisions.
Specifically, the NZS undertakes to:
Reaction:
Overall, the Net Zero Strategy has been welcomed as providing a clear response to the scale of the climate change challenge and the transformation to the UK economy that decarbonisation will require over the next 30 years.
In particular, commentators welcomed the prominence given to: the ZEV mandate!资助离岸风供应链和基础设施近海传输网络协调承诺审查CfD拍卖频率重写氢雄心and the nuclear power commitments.
Commentators have welcomed the emphasis on carbon sequestration, both through natural means (peat bogs, trees) and new capture and storage technologies. For others, the requirement for the UK Government to reflect environmental issues in national policy- making, is one of the most important commitments in the document, since it places net-zero at the core of governmental decision-making processes.
On the Other Hand…
No Strategy ever satisfies everyone and some of the critical comments are worth examining briefly.
1) Weaknesses of the Policy Offering
2) Reliance on Unproven Technology
3) Financing
4) Government Inconsistencies
The Treasury's Net Zero Review (NZR), released on the same day as the NZS, accepted that action to mitigate climate change was "essential to long-term UK prosperity". However, there were points where the NZR did not appear to share the NZS enthusiasm for the green revolution:
There are other areas of apparent inconsistency:
Comment:
For all this criticism, the NZS is a welcome document. It is one of the first to comprehensively attempt to chart with some degree of precision how a country (the UK in this case) will reach its mid-century Net-Zero target.
If it was not clear before, the NZS reveals the almost unimaginable scale of the transformation that will be necessary to reach Net-Zero by 2050. By 2035, electricity will be fully clean!燃气锅炉和油气耗车将从英国房屋和公路上消失by 2025, the UK will be planting trees covering an area the size of Milton Keynes annually. And Net-Zero considerations will be placed at the centre of Government policy decision-making.
It is also clear that the UK is serious about addressing the climate crisis and that there is cross-Party support for accelerating the UK's Energy Transition. The government views its Presidency of COP26 as an opportunity to act as a global catalyst for progress in confronting the climate crisis and the NZS is a road-map to which the UK Government hopes other countries will look for inspiration.
There will be turbulence as the UK economy adjusts to the transformation. Turbulence which may create investment risks, but will also create major opportunities for investment- wind, nuclear, hydrogen, EV, energy efficiency, smart grids, smart storage etc.
Covington is well-placed to offer legal and public policy advice and support to companies seeking to navigate this new environment and discuss these opportunities with you to identify how we might work together.
The European Commission has published a proposal for a Corporate Sustainability Reporting Directive (2021/0104) ("CSRD"), which forms just one part of a comprehensive package of sustainable finance measures (see our blog here).欧委会提出这些措施响应对更强和更广泛的可持续性报告标准的要求,超出欧委会当前提供s/eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A32014L0095CSRD通过修正欧盟现行法律,包括透明指令、会计指令和审计指令,努力授权可持续性报告与保证More fundamentally, according to the Commission, it will move the EU one step closer to realizing its aim of having sustainability reporting be "on a par" with financial reporting, in terms of attached weight and importance. This is reflected in the change of terminology used in the CSRD proposal, from a focus on "non-financial" information reporting, to "sustainability".
We cover below the background and detail, but in summary, these are the key elements of the CSRD proposal that corporates should be aware of:
Context: Need for Reform
To reach the EU's aim of becoming net zero by 2050, the Commission understands that private capital must be directed towards green, sustainable projects, and this requires that investors have access to clear and comprehensive information on their potential investees relating to, among other things, environmental sustainability and corporate governance practices.
Currently, the Non-Financial Reporting Directive requires in-scope companies to report on sustainability matters, including on environmental protection, social responsibility and treatment of employees, respect for human rights, anti-corruption and bribery, and diversity on company boards.
Yet, despite the Commission's publication of non-binding reporting guidelines and specific guidelines on climate-related reporting aimed at standardizing disclosures, concerns remained over the quality and consistency of the information disclosed.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A02019R2088-20200712多家这样的机构因此游说鼓励改革2019年底,委员会承诺,作为其“https://ec.europa.eu/info/strategy/priorities20192024/european-green-deal_en/EuropeanGreenDes
Company非欧盟公司欧盟子公司建议免责,供母公司遵守立法的集团内公司使用并注意,根据该提案,免责子公司需要发布合并管理集团报告并在其个人报告中注明免管CSRD。 与此相关,委员会澄清说,虽然公司可免交合并财务报告要求,但合并可持续性报告机制将分离,因此它们不一定免交后者。
非财务报告指令目前捕获约11 000家公司Under the CSRD, due to the broader definition of "large undertaking", as compared with "large public interest entity" under the Non-Financial Reporting Directive, the Commission estimates this number could rise to approximately 49,000.The listed SMEs, however, would not be subject to the same reporting standards as large undertakings. In parallel with the new rules for large undertakings, "proportionate standards" (i.e., simpler, less onerous standards) will be developed for SMEs by October 2023. While SMEs that are not listed on EU regulated markets do not fall under the proposed rules, the Commission suggests they would be able to use such standards on a purely voluntary basis, possibly as a method to enable more cost-efficient responses to requests for information from upstream entities, including banks and insurers.
(ii) Reporting Requirements: Inwards-Outwards, Forwards-Backwards…
One of the criticisms levied against the Non-Financial Reporting Directive was that it did too little to encourage consistent coverage in reports.The CSRD is intended to provide a much more granular level of detail regarding what information undertakings should report, covering the entire value chain.
The Commission now proposes that mandatory disclosures form part of a company's management report and include descriptions of:
As和量化信息,CSRD建议要求定性信息也包含在披露中,提供面向前和回溯信息覆盖短期、中期和长期提案还澄清说,“双重相对性”原则仍然存在,但澄清说,这意味着企业应报告理解可持续性问题对自身影响的必要信息,并报告理解对人与环境影响的必要信息-i.e./em大型多国公司应该知道,这一点和对“可持续性信息”(相对于非金融信息)的重视不同于气候相关财务披露标准工作队单镜或金融重要性透镜。
CSRD建议还引入强制可持续性报告标准这些标准旨在补充上文披露链表并进一步具体说明信息企业需要披露-可针对具体部门这些标准将采取委托行为形式,根据欧洲财务报告咨询组-欧盟支持的私人协会-的建议编写并咨询关键利益攸关方第一套标准规划于2022年10月前完成,第二套一年后完成。
持续报告标准预计将与下列主题标题相关:标准将包含全球接受标准的基本内容,包括与气候相关金融披露标准较窄与气候相关特别工作组,以确保欧盟保持广泛的一致性-即使欧盟决定更深入。
/so报告的可持续性信息准确可靠,CSRD提议对提供的可持续性信息进行强制性全欧盟审计或保证要求初始保证义务为“有限性”,但随着可持续性保证标准的发展,我们最终可能看到保证义务类似于财务报告所用的保证义务。CSRD建议允许成员国选择公司而非普通财务信息审核师确保可持续性信息 。
CSRD建议要求公司用欧洲单一电子格式编写管理报告和财务报表数字报告和标签系统允许将报告数据纳入规划中的欧洲单一存取点中(插图见https://eur-lex.europa.eu/legal-content/EN/TXT/HTML/?uri=CELEX:522020DC0590&from=ENCapital市场联盟行动计划 )并允许应用新手AI和机器学习技术EFRAG并行报告标准如果最终立法文本正式通过并可按照当前雄心勃勃估计商定可持续性报告标准(2022年上半年前),欧盟成员国需在2022年12月1日前实施CSRD大范围公司从2023年1月1日或以后的财年必须守法,发布2024年报告,上市中小企业从2026年1月1日守法。
If you have any questions concerning the material discussed in this blog, please contact the following members of our team:
John Ahern +44 20 7067 2190 JAhern@cov.com
Sebastian Vos +32 2 549 52 67 svos@cov.com
Thomas Reilly +44 20 7067 2357 treilly@cov.com
Sinéad Oryszczuk +44 20 7067 2141 soryszczuk@cov.com
Sarah Crowder +44 20 7067 2393 scrowder@cov.com
Katherine Kingsbury +44 20 7067 2041 kkingsbury@cov.com
Paul Mertenskötter +32 2 545 7517 pmertenskoetter@cov.com
和(2) 长期而言,根据2020s://ec.europa.eu/clima/policies/eu-Coltics-action/law_enFollowing the adoption of the EU Taxonomy Regulation (explained further below), the Sustainable Finance Disclosure Regulation, and the Benchmark Regulation, which enhances the transparency of benchmark methodologies, the Commission has in this legislative package laid out the next building blocks for its envisioned sustainable finance ecosystem.
In addition to the impact on financial institutions and investors directly subject to the new laws, the Sustainable Finance Package may impact corporates in the following ways:
The draft TCDA (in its Annexes, here and here) sets forth sector-specific definitions of environmentally sustainable economic activities, ranging from manufacturing to electricity generation and transport. Notably, although the TCDA sets criteria for when hydrogen manufacture may be considered a sustainable investment (as we discussed in a recent article), it does not cover natural gas or nuclear energy, which are expected to be covered by supplementary technical screening criteria later this year. The Commission will establish a web portal where stakeholders can make suggestions on other areas in mid-2021!可持续金融委员会和平台将评估这些建议。
bsistom规则于2020年7月12日生效,但核心透明度和披露规定从2022年1月1日起将仅适用于气候变化缓解和适应目标自2023年1月1日起,这些规定也将适用于分类规范中的其他环境目标。
TCDA仍受欧洲议会和理事会审查,它们有3个月时间提出任何反对意见,理论上可以阻塞TCDA的通过TCDA预期从2022瀑布应用 。
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研究结果将载入公司管理报告并发布于众,并通过设想的欧洲单一存取点向所有人提供https://ec.europa.eu/info/business-economist-euro/Crap-and-Investment/Captive-markets-uni然而,只有当委员会认为第三国可持续性报告义务与欧盟义务等值时,才提供豁免,该义务符合
If you have any questions concerning the material discussed in this blog, please contact the following members of our team:
John Ahern +44 20 7067 2190 jahern@cov.com Sebastian Vos +32 2 549 5267 svos@cov.com Thomas Reilly +44 20 7067 2000 treilly@cov.com Sinéad Oryszczuk +44 207 067 2141 soryszczuk@cov.com Sarah Crowder +44 20 7067 2393 scrowder@cov.com Paul Mertenskötter +32 2 545 7517 pmertenskoetter@cov.com
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[1] This term, coined by Anu Bradford of Columbia Law School, describes how the EU effectively sets global norms.企业通过严格的欧盟规则在欧洲市场合法运营,然后在全球遵守这些规则以尽量减少守法成本正像欧盟规则被视为金标准, 其他国家政府和国际组织复制规则, 并进一步加强这一效果 。
The Federal Energy Regulatory Commission (FERC) has for the first time ruled on whether the greenhouse gases (GHG) emitted during the construction and operation of a proposed natural gas pipeline has a significant impact on climate change in determining whether to authorize a project as consistent with public convenience and necessity under Section 7 of the Natural Gas Act. In earlier orders, FERC concluded that it was unable to assess the significance of a project's GHG emissions or those emissions' contribution to climate change. In a recent order approving Northern Natural Gas Company's proposal to replace a pipeline segment, FERC stated that is no longer the case and then assesses the significance of the project's GHG emissions and their contribution to climate change.
In a press release on the order, FERC Chairman Glick said "(a) proposed pipeline's contribution to climate change is one of its most consequential environmental impacts and we must consider all evidence in the record—both qualitative and quantitative—to assess the significance of that impact. I look forward to continuing to work with my colleagues as we refine our methods for doing so."
The Northern Natural order is significant because it reflects a willingness to consider the GHG impact of the construction and operation of a pipeline project on climate change and adopts a method for doing so. This development must, however, be kept in perspective. The GHG assessment in this case found no significant impacts and the GHG analysis drew dissents from two commissioners. It remains to be seen how FERC will address projects with significant GHG impacts that may raise issues of mitigation or even rejection of a project and how FERC will address authorizations for LNG export terminals.
The Northern Natural order
The National Environmental Policy Act of 1969 (NEPA) requires FERC to consider whether a proposed natural gas pipeline project will have a significant impact on the environment. In an apparent pushback to the prior claims of an inability to assess (GHG) emissions or those emissions' contribution to climate change, the order notes that "NEPA does not require that the studies, metrics, and models—scientific and otherwise—on which an agency relies be universally accepted or otherwise uncontested" but instead "permits agencies to rely on the best available evidence, quantitative and qualitative, even where that evidence has certain limitations."
For the Northern Natural project, FERC compared the project's reasonably foreseeable GHG emissions to the total GHG emissions of the United States as a whole. The order notes that this comparison provides "a reasoned basis to consider the significance of the project's GHG emissions and their potential impact on climate change." Based on the record, the order finds that the project's contribution to climate change would not be significant.
Going forward, FERC says it will "consider all appropriate evidence regarding the significance of a project's reasonably foreseeable GHG emissions and those emissions' contribution to climate change." If GHG emission impacts are significant, they "would be considered along with many other factors when determining whether a project is required by the public convenience and necessity."
Dissents
Commissioners Danly and Christie both concurred with the order's approval of Northern Natural's project but dissented on the application of the GHG impact analysis.
Commissioner Danly's lengthy dissent argues that the order violates the Administrative Procedure Act by reversing FERC's longstanding determination that it is unable to assess the significance of a project's greenhouse gas (GHG) emissions or their contribution to climate change without sufficient reasoning.The dissent says the reversal disregards a pending Notice of Inquiry (NOI) that seeks comments on the issue and the order announces a "fragmentary standard that provides no clarity because it fails to establish either a replacement framework or a threshold for when emissions will be deemed ‘significant.'" Commissioner Danly also argues that the Natural Gas Act does not grant FERC the authority to be an environmental regulator.
Commissioner Christie issued a short dissent objecting to the analysis of "the purported impact on climate change" of the project's GHG emissions. His dissent also argues that the GHG impact analysis is a "major question of law" to be considered in a pending NOI and that it "is unfair and premature at best" to decide it "in this order with its limited participation."
On March 4, 2020, the European Commission delivered the first major climate piece of its European Green Deal: it proposed a "European Climate Law," which takes the form of a Regulation and establishes a framework for the irreversible and gradual reduction of greenhouse gas emissions and the enhancement of removals in the European Union. The proposal and the fact that it takes the form of a binding Regulation may have a significant impact on a wide variety of legislative and policy initiatives that the EU and its Member States may take within the next years.
The proposed Regulation would set into binding legislation the EU's 2050 climate-neutrality objective and require the European Parliament, Council and Commission, as well as the EU Member States, to take the necessary measures to enable the collective achievement of this objective.It will also require the European Commission to review, by September 2020, the EU's emission reduction target for 2030, in light of the climate neutrality objective for 2050, and to explore options for a new 2030 emission reduction target of 50% to 55% in comparison to 1990 emissions.
The proposed Regulation would also empower the Commission to adopt Regulations, without having to negotiate them with Member States and the Parliament, setting up a trajectory at Union level to achieve the neutrality objective by 2050. This trajectory must start from the 2030 target and be amended in line with updates under the UNFCCC Paris Agreement.
The proposed Regulation would also require the EU institutions and Member States to continuously adopt measures to adapt to climate change.
Finally, the proposed Regulation would also require the Commission to engage with all stakeholders to enable and empower them to take action towards a climate-neutral and climate-resilient society.
The Commission's proposal to enshrine an EU neutrality target in a binding EU Regulation may have a significant legal and policy impact in the EU during the next decades. The Regulation may create a legal basis to oblige EU institutions and Member States to ensure that any policies they adopt are aimed to achieve climate neutrality by 2050, and also to allow NGOs to challenge before EU and Member State courts any EU and national measures that are not compatible with that objective.
Moreover, NGOs are demanding the Parliament and Council to include in the proposed Regulation explicit provisions allowing citizens and NGOs to take legal action against EU and Member State authorities for failure to comply with the 2050 climate neutrality objective. This could provide a boost to the climate change litigation that NGOs are already bringing against governments and companies across Europe (see for example the Urgenda case in the Netherlands). In this context, it is worth noting that the European Parliament's Resolution on the Green Deal of January 15, 2020 stressed that "all people living in Europe should be granted the fundamental right to a safe, clean, healthy and sustainable environment and to stable climate, without discrimination, and that this right must be delivered through ambitious policies and must be fully enforceable through the justice system at national and EU level."
The European Parliament and Council must now consider the proposed Climate Change Law for adoption through the so-called ordinary legislative procedure. The Commission hopes that the Parliament and Council will be able to reach an agreement on the text of the Regulation by the Autumn of 2020, in advance of the next UNFCCC COP 26 in Glasgow in November 2020.
Background on NOx Emissions from Heavy-Duty Vehicles
The South Coast Air Quality Management District (South Coast), which regulates the notoriously bad air pollution in the Los Angeles metropolitan area, led a coalition of state and local environmental agencies that petitioned the EPA in 2016 to adopt more stringent NOx standards for heavy-duty trucks.南岸单片
CTI公告重申前政府承诺减少高速重载卡车和引擎的NOx排放,尽管现政府提议修改轻型车辆温室气体标准和桥加利福尼亚州更严格管制温室气体排放的权力联邦政府和加利福尼亚州之间在重载车辆和拖车的温室气体标准上还可能出现单调争斗。
CaliforniaHDOBD规范
ObD规则自2012年以来首次通过修改 CARB
[1] In 2013, CARB adopted optional low-NOx emission standards for heavy-duty vehicles, intending to allow engine manufacturers to showcase new technologies that could reduce emissions to 90% below the current standard.
[2] With the National Highway Traffic Safety Administration (NHTSA), EPA has separately adopted GHG emission standards for heavy-duty vehicles, with the Phase 1 regulation for heavy-duty engines and vehicles going into effect for model year (MY) 2014 vehicles and Phase 2 regulation establishing the first emission requirements for trailers hauled by heavy-duty tractors starting in MY 2018.阶段2规范已暂停应用到拖车上(se卡车拖车制造商诉EPA等, no16-1430Cir市原创Oct并报告EPA正在重新考虑拖车标准2018年9月27日CARB