Worlds First Carbon Border Tariff, and SEC Disclosure Rule Updates

Energy Market Update

The Nov ‘23 natural gas contract saw some upward movement yesterday and this morning we're seeing the prompt month start to trade just over the three-dollar mark at $3.02/MMbtu. Warmer than average temperatures are expected to reside in the northeast region as well as the west coast. The remainder of the country is expected to remain average. Exports dipped a bit day over day at 12.6 Bcf/d, with no major ongoing outages across any facility. The weekly EIA storage report published an injection into underground storage of 86 Bcf which is less than expected. Stocks were 357 Bcf higher than last year at this time and 172 Bcf above the five-year average.

Sustainability

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

SEC Climate Related Disclosures

• Testimony Before the United States House of Representatives Committee on Financial Services, SEC. Gary Gensler, Chair of the SEC testifies in the House, clarifying the purpose and defending the importance of the upcoming Climate Disclosure Bill amidst growing criticism and a clear risk of litigation once the rule passes.
• SEC chief says new California law could 'change baseline' for coming SEC climate rule, Reuters. "If it were signed into law, as I understand it, that would require companies a certain size to report their climate risk," Gensler said in testimony before the House of Representatives."That may change the baseline. If those companies were reporting to California, then it would be in essence less costly because they'd already be producing that information."
• The week of June 19-23, the Securities & Exchange Commission indicated--through an update to a?GSA website?--that the proposed climate change disclosure rule would likely be finalized and released in October 2023
• SEC climate disclosure rule?delayed until fall 2023, former commissioner says,?S&P Global.?The SEC initially suggested the rule would be published in December 2022 and then again pushed that date back to April 2023.
• Given the new time frame, financial statements and disclosures under the rule would not be due until 2024

European Commission: ESRS under the CSRD

• The European Commission officially adopted the?first set of European Sustainability Reporting Standards (ESRS)?requiring companies to provide comprehensive and robust information about social and environmental impacts, risks and opportunities to a broad group of stakeholders on July 31, 2023.

ISSB?The?International Sustainability Standards Board

• International Sustainability Standards Board (ISSB)?will take over the Task Force on Climate-related Financial Disclosures’ (TCFD)?role in monitoring companies’ progress on climate-related disclosures. ISSB Chair?Emmanuel Faber?said, “The ISSB welcomes the FSB's request to transfer the TCFD’s monitoring responsibilities to the ISSB… This announcement provides yet further clarification of the so-called ‘alphabet soup’ of ESG initiatives for companies and investors.”
• ISSB Standards?launched week?26-30 June?2023

Notable News

Articles on Climate & the Environment

• Trillions In G20 Fossil Fuel Subsidies Fuel Profits And Climate Change, Forbes.
• With Climate Change, Smaller Storms Are Growing More Fearsome, More Often, NY Times.
• Wildfire Smoke From Canada Creates Unhealthy Air Quality in Florida, NY Times.
• The climate crisis is also a health crisis, NY Times.
• "Gobsmackingly" warm September was Earth's hottest on record, Axios.
• The hottest summer in human history – a visual timeline, Guardian.

Articles on Corporate Sustainability, Regulation, & Global Events

• How Construction Companies Can Move Towards Net Zero, Forbes.
• ISSB Standards Reveal Finance Is The Fuel For Sustainability, Forbes.
• 75% of Companies Not Ready for Pending ESG Data Assurance Requirements: KPMG Survey, ESG Today.
• EU launches first phase of world's first carbon border tariff, Reuters. "Sunday marks the start of an initial phase of the Carbon Border Adjustment Mechanism (CBAM) when EU importers will have to report the greenhouse gas emissions embedded during the production of imported volumes of iron and steel, aluminium, cement, electricity, fertilisers and hydrogen."
• Europe Just Launched the World’s First Carbon Tariff. Will the United States Follow Suit?, Inside Climate News.

Insightful Reports

IEA publishes 2023 updates to its landmark report Net Zero Roadmap: A Global Pathway to Keep the 1.5 °C Goal in Reach.

The UN’s global report card as part of the “The Global Stocktake” assessed progress since the 2015 Paris Agreement.

Investing in American Energy report by the US Department of Energy (DOE). Significant Impacts of the Inflation Reduction Act and Bipartisan Infrastructure Law on the U.S. Energy Economy and Emissions Reductions

Struggling with the details of?ISSB?/?IFRS,?ESRS?/?CSRD?or just overall?ESG?or?sustainability?frameworks? Check out the detailed analysis, tips and guidelines from?WBCSD – World Business Council for Sustainable Development.

This year’s edition of the?World Energy Investment?provides a full update on the investment picture in 2022 and an initial reading of the emerging picture for 2023.

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

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