Climate Policy

Japan is switching gas capacity to coal because LNG cannot get through a choked Strait of Hormuz, and that single operational decision tells you more about energy security than a year of policy papers. A heat dome over the eastern United States is simultaneously sending power demand to seasonal peaks, pushing spot electricity prices sharply higher in PJM and ERCOT markets. The second-order effect: LNG that would have flowed to Asia is being absorbed by US domestic demand and diverted away from Hormuz-dependent routes, compressing supply on multiple fronts at once. European gas buyers, who spent 2022 rebuilding storage after Russia's cuts, are now facing renewed competition for the same spot cargoes. If Hormuz disruption persists through Q3, thermal coal prices will continue climbing and the economics of Japan's planned coal phase-out get pushed out by at least two years.

A projected $127 billion shortfall in aviation carbon credits is not an abstract compliance problem. It is a cost that sits between airlines and their current ticket pricing, and the pressure will transmit to fares at a time when carriers are already managing fuel and labour inflation. The mechanism is CORSIA, the international offset scheme that requires airlines to purchase credits for emissions above 2019 baseline levels, and the supply of eligible credits is structurally insufficient relative to the volume of flying now projected through the early 2030s. IAG, which operates British Airways and Iberia, is among the carriers most exposed given its long-haul mix. Investors in airline equity should treat this as a margin headwind that is not yet priced into most forward earnings models, and UK leisure operators with contracted seat blocks should be modelling the pass-through risk now.

Industry-aligned actors are working to sideline climate attribution research that quantifies how human emissions increased specific extreme events, as it becomes central evidence in billions of dollars worth of climate liability lawsuits worldwide.

Amsterdam becomes the first world capital to ban both meat and fossil fuel advertising in public spaces starting May 1, following a 27-18 council vote. The prohibition covers billboards and bus stops but exempts private premises and general brand promotions. GroenLinks and the Party for the Animals drove the measure targeting large corporations that drive climate crisis. The ban aligns with Amsterdam's goal of increasing plant-based protein consumption from 40% to 60% by 2030. Legal challenges from advertisers over existing contracts remain possible, while other Dutch cities watch for replication potential.

Beijing is restarting mothballed coal-to-gas projects after years of pushing clean energy alternatives, marking the clearest sign yet that energy security now outranks climate commitments. The reversal comes as China faces potential energy supply disruptions from escalating Middle East tensions and US sanctions on Russian energy infrastructure. Coal-to-gas conversion produces 40 percent more carbon emissions than importing LNG, but offers complete supply chain control in a fragmenting global energy system.

Ed Miliband controls the biggest spending department, the most politically sensitive policies, and increasingly the government's entire economic strategy. His energy and climate brief now touches everything from industrial policy to housing costs, making him more influential than most chancellors. The question hanging over Starmer's cabinet is whether Miliband's technocratic approach can survive contact with voter bills. His carbon pricing plans will determine whether Labour's green transition becomes an economic asset or electoral liability.