Decarbon Weekly: India's Role in the Climate Fight, Renewables aren't Getting Built, The Fake Meat Fab and the False Promise of Electric Cars?
Rayyan Islam
Co-Founder & General Partner at 8090 Industries. Merchant of Industrial Progress. Neo-Industrialist.
Fellow Agents of Change:
Today marks the 70th edition of the Decarbon Weekly newsletter and this one in particular highlights a number of the challenges and pitfalls being faced across the energy transition, whether it’s the deployment pace of renewables, the alternative meats transition, commercial nuclear fusion or even the frameworks for enabling the EV transition. In order to have a real pulse on what’s happening across decarbonization (especially for those of us innovating or supporting innovators) we believe it is imperative to have a full grasp of the relevant blind spots and dynamics underpinning these challenges to pave a path for more practical approaches to the energy transition.
We also cover the rise of India and their critical role in the energy transition, home to 7% of the world’s GHG, incredibly ambitious net-zero emissions targets by its government, and multiple industry leading titans in a race to capitalize on the opportunity.
WHAT CAUGHT OUR EYE:
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WHAT CAUGHT OUR EYE:
Investors Plow $40B Into Renewables, but Projects Aren’t Getting Built:?Penned by Jennifer Hiller of WSJ, this article summarizes what the tech ecosystem overlooks but infrastructure teams scrutinize: Renewables Development, and today, new renewable development projects have become more difficult to construct and finance than ever. A great reminder to not simply glance the headlines and to pay attention to the supply chain and dyanmics on the ground. Even as developers plan an unprecedented number of grid-scale wind and solar installations, project construction is plummeting across the U.S. Despite?billions of dollars in federal tax credits?up for grabs and?investors eager to fund clean energy projects, the pace of development has ground to a crawl and many renewables plans face an uncertain path to completion. Supply-chain snags, long waits to connect to the grid and challenging regulatory and political environments across the country are contributing to significant slowdown. How significant? New wind installations plunged 77.5% in the third quarter of 2022 versus the same period the year before. New utility-scale solar installations fell ~40% in 2022 compared with 2021. Supply-chain and trade issues have complicated planning. Average lead times for securing high voltage equipment have risen from 30 weeks to more than 70, Mr. Birchby said.?Sourcing solar panels?has turned into the stuff of spy stories as companies try to avoid running afoul of trade regulations and navigate risks and complications of global shipping. A bigger unknown is the time and cost to get new batteries or solar or wind farms connected to the grid, as grid operators and interconnecting utilities?must study the projects’ likely impact on the power system?and any needed network upgrades before signing off on them.
“Ten years from now there’s going to be a huge shift in the landscape where there is going to be a significant amount of electricity coming from renewables,” said Matt Birchby, president of renewable-project developer and owner Swift Current Energy LLC. “But getting from A to B is inherently going to be messy.”
In the three decades since reducing emissions became a discussion point on the global stage, analysts have portrayed the U.S., China, and Europe as the most critical targets for cutting pollution. But as the curve finally begins to bend in those places, it’s become clear that India will soon be the most important country in the climate change effort. Today, India contributes 7% of global GHG emissions, a percentage that will expand alongside its economy. This growth will help determine whether—and by how far—the world blows past the Paris Agreement target of 1.5°C. Equally important, India’s approach is being watched elsewhere. If it can use low-carbon development including?ambitious green hydrogen iniatives?to?bring prosperity to its 1.4 billion people, others will follow and failure could lead to a retrenchment into fossil fuels across the Global South. A must read with incredible writing and on the ground reporting from one of my favorite writers, Justin Worland, from TIME Magazine.
India’s government is following an approach uncharted for a country of its scale: pursue green technologies in the midst of industrialization while leaving the fate of coal to the market. “India, as a responsible global citizen, is willing to make the bet that it can satisfy the aspiration for higher living standards, while pursuing a quite different energy strategy from any large country before,” says Suman Bery, who leads NITI Aayog, the Indian government’s economic policy-making agency. India, Bery says, will pursue clean energy while seeking a “balance between energy access and affordability, energy security, and environmental considerations.”
领英推荐
We’re incredibly excited to make our newest investment in?Liberation Labs, addressing agriculture and meat and food production. This article from Biofuels digest, takes a deeper look under the hood of the big bottleneck in costs and production facing the cellular agriculture space. Put simply, over the last couple of decades, VCs have been showering money on start-ups focused on the future of cellular agriculture, which seem to be multiplying like rabbits. Entrepreneurs can hold up flasks, proudly showcasing their products, declaring commercial readiness. But there is a problem. Over the same couple of decades, “capital light” has been the scale-up/commercialization mantra: why build when one can use someone else’s facility?” The predictable result of a tsunami of new companies?formed?and no new manufacturing at scale built? The fermentation Squeeze.
“As Mark?Warner tipped in The Digest a few years back, there has been “a rise in investors more interested in developing infrastructure and manufacturing capabilities, but these remain in the minority. Time is required for design, permitting, construction, and commissioning…and then the facility is not initially operated at full capacity as sales have to ramp up. This all requires deep pockets and patience.”
In January last year, Carlos Tavares, the CEO of Stellantis, the world’s fifth-largest carmaker (it was formed by the merger of Fiat Chrysler and Peugeot), described electrification as “a technology chosen by politicians” and said it was “imposed” on the auto sector. By contrast, the triumph of the internal-combustion engine (ICE) over a century ago was organic. Human ingenuity and the power of markets led to a product that swept almost everything else off the road. EVs (which first had a moment around 1900) were not banned, and neither was the horse. In due course, ICE horseless carriages for the Astors were followed by the Model T and its kin. The automotive age had truly arrived.
Fake Meat Was Supposed to Save the World. Was it Just Another Fad??Incredible reporting from Deena Shanker from Bloomberg highlighting the rise and stagnation of plant based meats. Today, the industry today looks more like a niche category than a meaningful bold displacement of an entrenched industry. After Beyond, Impossible and their copycats spent years trying to seduce everyone away from meat, it appears their best customers are seemingly, the 5% of the population who didn’t eat meat in the first place.
Between the two heavyweights Beyond and Impossible, Beyond lost sales in almost every channel last quarter,?laid off?more than 20% of its workforce, lost more than half of its C-suite and halted projects including vegan hot dogs and the next alt-protein frontier of?cell-cultured meat. None of the biggest fast-food chains that announced partnerships with Beyond—KFC, Pizza Hut?and, most important,?McDonald’s—have put a single permanent item on their US menus. And as a result, the company’s stock price is down about 76% from a year earlier and roughly 93% from its peak in the summer of 2019. Impossible, meanwhile, is faring better, and under new CEO Peter McGuinness, the company spun up new products such as?animal-shaped faux chicken nuggets?and blitzed supermarkets, leading to more than 50% retail sales growth in the US in 2022.
Meanwhile, a new meat alternative has found its way into the next hype cycle:?cellular meat. Grown in giant precision fermentation tanks from cells harvested from living animals, lab-grown beef, chicken and fish are theoretically better for the environment than the real thing and should taste as good. Startups in this space have raked in $2.6 billion in funding from investors including, once again,?Bill Gates?and?Leonardo DiCaprio. The category will have to overcome even bigger hurdles than plant-based meat, from the massive amount of energy required to make the products to exorbitant costs. But for boosters, its potential is already limitless. “This,” Whole Foods co-founder Mackey said after investing in cellular startup?Upside Foods Inc., “could change the world.”
“When industry watchers were still figuring out whether plant-based meat might pull an alt-milk-size market disruption, many missed two key differences: lactose-intolerant consumers and milk’s primary use as an ingredient, not a main course. Many soy, almond and oat milk drinkers add it to their coffee because real milk simply isn’t an option. But they’re mostly not drinking it by the glass. Even predictions of a sales rebound for plant-based meat are dwarfed by what’s happening in dairy. Bloomberg Intelligence expectations for the industry see plant-based dairy sales to rise 6-8% and meat alternatives 1-2% in the second half of 2023.”
Last?month,?inside a gold-plated drum in a Northern California lab, a group of scientists briefly recreated the physics that power the sun. Their late-night experiment involved firing 192 lasers into the capsule, which contained a peppercorn-sized pellet filled with hydrogen atoms. Some of those atoms, which ordinarily repel, were smushed together and fused, producing energy. By standards of Earth-bound fusion reactions, it was a?lot?of energy. For years, scientists have done this type of experiment only to see it fall short of the energy used to cook the fuel. This time, at long last, they exceeded it. While the moment was an exciting leap in science, we have a long ways to go to take the capabilities manifested by this milestone into commercial fusion power that can be used in industry. Wired reporter Gregory Barber does a fantastic job highlighting the challenges and what needs to happen to finally get this technology there.
“Today, the NIF researchers said they got as much energy out as their laser fired at the experiment—a massive, long-awaited achievement. But the problem is that the energy in those lasers represents a tiny fraction of the?total?power involved in firing up the lasers.?By that measure, NIF is getting way less than it’s putting in. “That type of breakeven is way, way, way, way down the road,” Cappelli says. “That’s decades down the road. Maybe even a half-century down the road.”
Elizabeth Elkin of Bloomberg covers an overview of the latest developments in fertilizer innovation spurred by supply chain crunches, price fluctuations and emissions targets. Farmers depend on synthetic fertilizer to deliver the high crop yields required to meet global food demand, but that comes at a cost to the environment. Much fertilizer production relies on natural gas or coal, accounting for?just over 2%?of the world’s climate-warming emissions, and chemical fertilizers contribute to agricultural?runoff?that damages wildlife. For growers, fertilizer costs can also be wildly?unpredictable, because prices are based on the availability of commodities including nitrogen, phosphorous, potassium and gas. The problem compounds with?Russia’s invasion of Ukraine, which cut off almost a fifth of the world’s fertilizer exports for part of last year and also crimped gas supplies, causing US fertilizer prices to hit a record last March. All this has spurred a hunt for alternatives to mineral fertilizers that’s starting to achieve results. Agribusiness heavyweights including Bayer, Corteva and Archer-Daniels-Midland and a crop of startups are closing in on some solutions to reduce the use of conventional fertilizers, including turning to microbes, recycled organic waste and other lower-emission and chemical-free substitutes. The industry’s resolve has been strengthened by?Russia’s invasion of Ukraine, which cut off almost a fifth of the world’s fertilizer exports for part of last year and also crimped gas supplies, causing US fertilizer prices to hit a record last March.
“Technology’s going to result in producing more food or more calories of nutrition,” Haney says, “with fewer inputs and reduced environmental impact.”