The Climate of Business #65: The industry we all rely on needs a rework to be decarbonised

On a more personal note today I would like to start by sharing two big announcements on the Plan A front. Last week we officially announced a global exclusive partnership with VISA (read more here ), while today we announced the joining of Neil as Chief Revenue Officer (read more here ). Expect a few more in the coming weeks. We are just starting.

Climate Change Reality

Elderly villagers become film stars to put Bolivia’s climate plight in focus (The Guardian )

US to pay $75m to relocate tribes facing flood threat (BBC News )

A new kind of climate refugee is emerging (NPR )

#ClimateScam : denialism claims flooding Twitter have scientists worried (The Guardian )

Why I’m becoming a climate optimist (GreenBiz )

Lagoon dries up as drought grips Peru’s southern Andes (AP )

World Bank says air pollution costs Bangladesh up to 4.4% of GDP (Bloomberg )

A UK tree provides hundreds of pounds of benefits a year, report finds (The Guardian )

Business Climate Reality

Can we rewrite the rules of green finance quickly enough? (GreenBiz )

EU looks to exclude banks and funds from sustainability rules (Financial Times )

UN says new biodiversity credits can succeed where carbon offsets failed (Bloomberg)

Vermont’s dairy farms recede, giving way to shrimp, saffron and new ideas (The Washington Post )

How to reboot climate policy after COP27: five models of policy making (Forbes )

Many Australian businesses will scale back climate action when economy slows, survey finds (The Guardian )

Federal scientists outline plan to study carbon removal (Politico )

Why wind energy isn’t living up to its pollution-preventing potential (The Verge )

A heat pump with DIY installation can decarbonise public housing (Bloomberg )

Japan looks to build buffer of natural gas in case of supply crunch (The Wall Street Journal )

Reality Check

Industry Profile

Industry? Emissions: in 2021 total greenhouse gas emissions reached 36.3 gigatonnes (Gt), even after the 5.2% reduction that happen during the 2020 pandemic

Net Zero Industry Pledge: 2050

Part of Paris Agreements: Yes

Expected Growth: By 2050, it might be that globally we would need 2 - 2.5 times the amount of energy we use today.

Important bodies to know

International Energy Agency (IEA) is an agency that works with both governments and industry to shape how we as society globally approach energy. Created in 1874 to help with the major disruptions in the supply of oil, it also now focuses on energy security and policies and it is also now driving the sustainable development of new energy sources.

The Industry & its Sustainability?

More than any other sector, the power sector is perhaps the one that has been in the news more than any other and rightfully so. With a disturbed supply, resulting price increases, as well as continued instabilities of other sorts, the industry has gotten a wake up call it needed to change.?

How do you transition such an instrumental sector to the economy given the rapid growth in energy consumption??

The key learning from the last months has been that In order to decarbonise the energy industry we need to fully move away from fossil fuels. An obvious yet ignore for long conclusion.

Challenges to Net Zero Transition

1.Renewables are still not 100% infallible

• 24/7 matching of wind and solar supply like we do with fossil fuels is not possible.
• The limitations and challenges of renewable energy in terms of supply happen and they might not be able to fit demands all the time.
• In order to not rely anymore on fossil fuels as backups and in order to match supply and demand when the renewable power production is depressed.?
• Possible examples would be biofuels, bioenergy carbon capture and storage and Power to Gas to Power (P2G2P) technology.

2. Settle the dispute on what type of new alternative energy to use as well as their development

Newer forms of energy don’t come without its calms and there is serious public debate and even between governments on what is the right path, particularly when it comes to nuclear vs renewables. The claim that either nuclear or renewable energy are carbon free only applies to their production, it doesn’t take into account the mining of raw materials that are necessary to construct the equipment, as well as the health and pollution risks this mining entails.?

• The fear of a meltdown: When it comes to nuclear, there is always the fear of another meltdown, with the memoir of Chernobyl still in the minds of people.
• Waste from nuclear: The question of how to handle the waste and as well the potential pollution from radioactive leaks still remains, particularly into the water system via the consumed fuel rods.
• Impact on biodiversity: But wind and solar have also been on the face of backlash due to their effect on biodiversity and local ecosystems:?
• Land for solar: For solar, lands need to be cleared for the production of solar farms, creating large scale deforestation, hurting the ecosystems (like hurting pollination in the area) and leading to other climate effects (soil erosion, etc).
• Impact on biodiversity #2: While wind farms are decimating bird and bat populations, with an estimated 328,000 birds deaths yearly in the US alone. Not only have they put in causing the survival of certain species such as eagles, a diminished bird population will lead to insect overpopulation, which can cause viral outbreaks as well as other problems for agriculture.

Solutions for decarbonisation and sustainable transformation of the industry?

Short-term

Incorporating new energy sources in our urban and business planning

• Reaching 50-60% decarbonisation through renewable energy can be done with little to no investment beyond that of?rational economic behaviour. Example: buying Electric Vehicle given subsidies and cost of energy.
• Incorporating renewable energy investments into building and city planning, with the creation of solar farms or even having them on buildings.
• Wind could then be complementary to solar as wind is not as predictable and can even be stronger during the night.

Continue to develop frameworks and regulations that help the further development of these new energy forms

Long-term

Considering reaching 80-100% decarbonisation by 2040 will require more systemic changes and market-specific actions.

Better storage?

Better batteries or other means of storing energy will need to be developed over time, if we don’t want?to reduce energy expenditure and/or continue to grow it, in case it is required for further development.

This will be particularly the case with energy farms like wind and solar, whose energy streams cannot be as controlled and predicted as hydrogen and nuclear. Businesses and governments would be required to have batteries in order to be able to use them for longer periods of time and for the demand to be managed more tightly.

Power systems need to adapt, but to which technology?

Grid systems would need to be adapted and transmission interconnections in order to pull renewable assets as well as share the base load resources would need to be created. These are challenges as it is difficult to predict, given the fast pace of technological advancements. This makes overall planning difficult.

Planners would need to develop ways of incorporating projected energy flows and consumption patterns into their planning, as well as consider the further development of increasingly complex networks of supply and demand; new demands of bidirectional flow of power, etc.

As well as consider the full potential of other possible innovations/needs, such as storage development and the ability to incorporate or balance different assets in one system, such as transmission, hydrogen, P2G2P technology, and CCUS.?

Carbon Price