Low Temps Expected to Drive Heating Demand Through May, WatchWire's First User Event, & Sustainability Reporting Updates

Weekly Energy Market Update:

The June ‘23 natural gas contract is trading up $0.23 at $2.34 and inventories are 2,009 Bcf. This represents a net increase of 79 Bcf from the previous week. Stocks were 5, 525 Bcf or 35.4% more than the same period last year and 36759Bcf or 22.2% more than the 5-year average. Heating demand increased as temperatures are expected to persist below normal in the eastern half of the country through the beginning of May. Even though the EIA reported a healthy rise in stocks, the expectation of cooler weather is causing movement in the gas futures market.

Natural gas pricing plays a key role in electricity power pricing due to the increasing reliance on natural gas fired generators as nuclear, coal, and oil generation is retired and mothballed. As the marginal unit of generation, gas prices are directly correlated to power pricing (more so in some regions such as NYC vs. others such as parts of PJM). We keep an eye on natural gas market fundamentals in order to provide insights into forward power pricing for our clients. Gas production has grown and surpassed any speculation that production would not be able to keep up with demand due to LNG and Mexican exports.?

View Graphs and Full Report Here >>

Sustainability

Integrate23

Yesterday, WatchWire hosted it's inaugural user event?INTEGRATE 23. Highlights of the day include an engaging keynote with?Carolyn Kissane, a thorough roadmap review which revealed a ton of exciting features headed to the platform, two compelling speaker panels on the issues and opportunities that come with sustainability reporting and demand response, and user trainings on Carbon Accounting, Goal Tracking, Budgeting, and more. The event concluded with a cocktail reception at the beautiful Virgin Hotel SkyLoft lounge. We are so pleased with the turnout and engagement from our clients and look forward to hosting more user events in the years to come. Over the next few days stay tuned as we share insights, summaries, and educational content from the event.

Updates to Sustainability Reporting?Regulations?and Moves for?Consolidation?of Standards:

SEC

• SEC claims they will finalize the climate disclosure rule by the?end of April.
• A new interview from the WSJ discusses climate disclosure and the usefulness of ISSB, and GRI standards in preparing for anticipated U.S. SEC disclosure rules:?A Materiality Focus Can Help Clear Up Climate Disclosure Uncertainty

ISSB?The?International Sustainability Standards Board

• NEW:?ISSB?on April 4 announced that companies can take a phased-in approach to reporting under its forthcoming?sustainability?standards, allowing them to focus only on?climate-specific information in the first reporting year of 2024 and wait to add other sustainability-related disclosures in 2025.?
• ISSB said it will relax other elements of the standards for the full first year a company uses the standards, including not having to report on Scope 3 greenhouse gas emissions
• Key dates for S1 General Sustainability-Related Disclosures and S2 Climate-Related Disclosures:
• Released by: end of June 2023
• Come into effect: start of Jan 2024
• Thirteen of fourteen members of ISSB’s board?agreed to reference both the Global Reporting Initiative (GRI) and the European Sustainability Reporting Standard (ESRS) frameworks in sources of guidance for IFRS S1.
• ISSB has just decided that its initial IFRS Sustainability Disclosure Standards, S1 (general sustainability) and S2 (climate-specific), will?become?effective starting January 2024, meaning that businesses can start collecting sustainability-related disclosure information for the 2024 period to publish reports in 2025.
• ISSB will be releasing the finalized versions of the first global standards for sustainability and climate-related reporting (IFRS S1 and IFRS S2) in?June?of this year or end of Q2 2023?—?according to the IFRS head, Erikki Liikanen?

CSRD

• The release of sector specific European Sustainability Reporting Standards (ESRS) will be delayed by one year, according to European Financial Reporting Advisory Group (EFRAG).
• ?EFRAG Update?for March 2023
• Europe’s three primary financial regulatory agencies, the European Supervisory Authorities (ESAs) each announced the?release of their opinions?on the first set of draft European Sustainability Reporting Standards.
• The?European Commission?re-confirmed that it will publish its regulatory proposal on ESG ratings on?June 13, 2023.
• European Financial Reporting Advisory Group (EFRAG) published its?update for January 2023, reporting on the work that has begun to develop the ESRS for listed small and medium enterprises (SME) and small and noncomplex financial institutions and captive insurances and re-insurances. CSRD and ESRS are aiming to bring smaller companies – both listed and private – into the fold, which is important to keep an eye on.

General?Corporate Reporting

SBTi?(Science Based Targets Initiative)

• The Science Based Targets initiative (SBTi) has updated eight of its key resources that enable companies and financial institutions to set and commit to setting science-based emission reduction targets. (April 23)
• The SBTI has launched?new guidance?for investors to support in identifying the overlaps of the SBTi Financial Institutions (FIs) framework, and Task Force on Climate-related Financial Disclosures (TCFD) recommendations. This will "support enhanced coordination between financial institutions science-based target setting and climate-related financial disclosures".

SASB

• Future of the SASB Standards: What you need to know for 2023 disclosure. The ISSB recently made several decisions that further clarify the role and evolution of the SASB Standards. The ISSB confirmed that industry-specific disclosures are required and, in the absence of specific IFRS Sustainability Disclosure Standards, companies must consider the SASB Standards to identify sustainability-related risks, opportunities, and appropriate metrics.

GRESB

• Subscribe to the GRESB Linkedin Newsletter here >>

Notable News

Articles

• Do You Even Decarbonize, Bro?, NY Times. " Deploy” has become a rallying cry for decarb bros. They argue that deploying climate technology solutions — solar panels, wind turbines, heat pumps, electric cars, meat alternatives (the list goes on) — will decarbonize the economy while generating eye-popping financial returns."
• What the Upcoming ISSB Standards Mean for Corporate Reporters and Issuers, Sustainalytics.
• With Two Key Picks, Biden Weaves Climate Into Economy and Regulations, NY Times. "The president adds climate champions Lael Brainard as his top economic adviser and Richard Revesz as his regulations chief."
• Hong Kong to make climate disclosures mandatory for issuers, Reuters. "The Hong Kong stock exchange (HKEX) plans to make it mandatory for companies listed there to make climate-related disclosures, as the city strives to stay competitive as a green and sustainable financial centre."
• Analysis: Shell admits 1.5C climate goal means immediate end to fossil fuel growth, Carbon Brief.
• EU Lawmakers Approve New Carbon Tax, Tougher Emissions Trading System, ESG today.
• Why communicating on climate is so hard, GreenBiz. "To meet climate goals, we need to tell better stories."
• So Sue Me: Study Finds that Litigation Risks Alter Company Disclosure Practices
• Guest Post: SEC Steps up Enforcement on ESG Reporting with Climate Disclosure Rules Looming, ESG Today. "With several recent high-profile enforcement actions and the creation of a new Climate and ESG Task Force, the Securities and Exchange Commission (SEC) has made it clear that it intends to proactively pursue companies for ESG-related reporting misconduct."
• The Hotchpotch World Of Financed Emissions: A Case Study Of Top Four US Banks In The Energy Sector, Forbes. "Financed emissions targets reported by the top four US banks (Citibank, JP Morgan, Morgan Stanley, and Goldman Sachs) have a long way to go before they approach the comparability of numbers in financial statements."

Insightful Reports

IBM's recent ESG global survey covered more than 20,000 consumers and +2,500 executives with a focus on their sustainability preferences when making employment and purchase decisions.

Ember's Global Electricity Review 2023. The report analyzed electricity data from countries representing 93% of global power demand and found that electricity produced in 2022 was the cleanest ever. Solar and wind represented 12% of global electricity production, up from 10% in 2021, and all clean energy, including hydro and nuclear, made up a record 39%.

After years of work, involving hundreds of researchers from around the world, the Intergovernmental Panel on Climate Change (IPCC), has published a synthesis report on the latest?Climate Change?science this week.?Intergovernmental Panel on Climate Change’s (IPCC)?Sixth Assessment Report (AR6)

The 2023 Climate Risk Landscape Report, by the UN Environment Program. It highlights the latest developments in the rapidly evolving climate tool marketplace, featuring over 3 dozen tools for physical and transition risk as well as climate alignment

CDPs latest?Non Disclosure Campaign: 2022 Results Report

Norton Rose Fulbright’s?2023 Annual Litigation Trends Survey?indicates that environmental, social, and governance (ESG) concerns are growing.?

WatchWire Resources:

Sustainability reporting season is upon us! With that, it is important to keep up to date with sustainability reporting frameworks like CDP. CDP is a global disclosure system for investors, companies, cities, states, and regions to manage their environmental impact.

Join WatchWire for our webinar, "Reporting to CDP: Tips and Best Practices for the World's Largest Environmental Disclosure Framework." In this session, we will be sharing the most important updates to sustainability reporting frameworks this year.

We will discuss:

• The Who, What, Why of CDP
• Sustainability reporting, specifically CDP, best practices
• How to drive climate action through disclosure
• Advantages in reporting to CDP
• How WatchWire can simplify your reporting process and improve your score

Register now. >>>

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