This law firm has just joined the World Bank’s carbon price coalition
Baker & McKenzie has become the first legal industry representative to join the Carbon Pricing Leadership Coalition (CPLC), an effort by the World Bank, the International Monetary Fund (IMF), private sector companies, governments and not-for-profits to share best practice and expand the evidence base for carbon pricing schemes.
A carbon price is a fee applied to carbon pollution designed to discourage pollution and reduce emissions while driving investment toward clean energy alternatives. The law firm, headquartered in Chicago, is the second-largest in the world, with more than 12,000 employees globally. It joined the CPLC late last week.
"We have a long-standing commitment to helping companies respond innovatively to the risks – and opportunities – of climate change law and regulation anywhere around the globe,” said Martijn Wilder, the Head of Baker & McKenzie’s global environmental markets and climate change practice.
"Joining the CPLC sets us among many of our key clients - who are often under far greater pressure on environmental issues than us and increasingly expect best practice from their advisers."
There are two different methods for implementing a carbon price: a cap-and-trade system and a carbon tax. The former creates a market for emissions allowances by letting low-emissions industries sell their extra allowances to larger emitters. A carbon tax establishes a price on carbon by placing a tax rate on the carbon content of fossil fuels.
As part of its CPLC membership, Baker & McKenzie has committed to working with its clients to develop effective carbon reduction policies and collaborating with other members to establish a worldwide carbon price.
A recent report by the Carbon Disclosure Project revealed that hundreds of businesses are already outpacing governments in their respective commitments to a carbon price.
Trafigura and Yara International explore clean ammonia usage
Reducing shipping emissions is a vital component of the fight against global climate change, yet Greenhouse Gas emissions from the global maritime sector are increasing - and at odds with the IMO's strategy to cut absolute emissions by at least 50% by 2050.
How more than 70,000 ships can decrease their reliance on carbon-based sources is one of transport's most pressing decarbonisation challenges.
Yara and Trafigura intend to collaborate on initiatives that will establish themselves in the clean ammonia value chain. Under the MoU announced today, Trafigura and Yara intend to work together in the following areas:
- The supply of clean ammonia by Yara to Trafigura Group companies
- Exploration of joint R&D initiatives for clean ammonia application as a marine fuel
- Development of new clean ammonia assets including marine fuel infrastructure and market opportunities
Magnus Krogh Ankarstrand, President of Yara Clean Ammonia, said the agreement is a good example of cross-industry collaboration to develop and promote zero-emission fuel in the form of clean ammonia for the shipping industry. "Building clean ammonia value chains is critical to facilitate the transition to zero emission fuels by enabling the hydrogen economy – not least within trade and distribution where both Yara and Trafigura have leading capabilities. Demand and supply of clean ammonia need to be developed in tandem," he said.
There is a growing consensus that hydrogen-based fuels will ultimately be the shipping fuels of the future, but clear and comprehensive regulation is essential, according to Jose Maria Larocca, Executive Director and Co-Head of Oil Trading for Trafigura.
Ammonia has a number of properties that require "further investigation," according to Wartsila. "It ignites and burns poorly compared to other fuels and is toxic and corrosive, making safe handling and storage important. Burning ammonia could also lead to higher NOx emissions unless controlled either by aftertreatment or by optimising the combustion process," it notes.
Trafigura has co-sponsored the R&D of MAN Energy Solutions’ ammonia-fuelled engine for maritime vessels, has performed in-depth studies of transport fuels with reduced greenhouse gas emissions, and has published a white paper on the need for a global carbon levy for shipping fuels to be introduced by International Maritime Organization.
Oslo-based Yara produces roughly 8.5 million tonnes of ammonia annually and employs a fleet of 11 ammonia carriers, including 5 fully owned ships, and owns 18 marine ammonia terminals with 580 kt of storage capacity – enabling it to produce and deliver ammonia across the globe.
It recently established a new clean ammonia unit to capture growth opportunities in emission-free fuel for shipping and power, carbon-free fertilizer and ammonia for industrial applications.