Hurricane Ian Wreaks Havoc

The phrase "all politics is local" - commonly attributed to Tip O'Neill, a former Speaker of the U.S. House of Representatives - came to mind as I sat down to write this week’s newsletter.? This week, the quote should be rephrased as “all climate change is local.”

Throughout this year, we have reported on floods, storms and other devastating weather events all over the world fueled by climate change. But, when it hits close to home as Hurricane Ian did this week, there is a heightened sense of urgency and dread. Perhaps some of you had a similar week of worry with loved ones in the path of this monster storm? (I am thankful that my family members are safe and my heart goes out to those who have experienced loss or are still in danger.)?

Even as hurricane Ian continues its path of destruction, the debate is raging about the connection between the intensity of this storm and climate change. CNN’s Don Lemon was scolded for turning the NOAA Hurricane Ian interview into a climate crisis debate filling conservative media outlets with joy (more on this below in notable news).

Bill McKibben laid it out well in his New Yorker column: “We’ve trapped a huge amount of the sun’s heat in the atmosphere by burning fossil fuel—the heat equivalent of more than half a million Hiroshima-sized explosions each day. That energy gets expressed in many ways. Most of that excess heat—about ninety-three percent of it—has gone not into the atmosphere but into the oceans, and that has a direct bearing on storms like Ian. Hurricanes draw their power from ocean heat, and so more storms in recent years have shown an inclination toward what scientists call “rapid intensification,” their winds spinning up rapidly as they pass over patches of particularly hot water (such as, for instance, the current Gulf of Mexico).”

Environment and Energy Leader

Financing Net Zero?

The costs to clean up the damage from Hurricane Ian will soar into the billions. And then these costs will be multiplied by the next extreme weather event and the one after that. For years now, the financial community has been waking up to the financial risks of climate change and, this week they proposed new actions.

The Net-Zero Asset Owner Alliance (NZAO - a UN-convened group formed of 74 institutional investors with over $10.6tn in assets) published a new report calling for greater use of blended finance vehicles to fund a net zero transition. Blended finance is the combination of?development finance (such as loans from the world bank) and private capital.??

“Africa alone needs an estimated $3tn by the end of this decade to achieve its collective climate goals. For the world as a whole, we’re looking at anywhere between $3tn and $6tn per year until 2050.” Said Guenther Thallinger, chair of the Alliance.

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World Bank Woes?

NZAO is a powerful voice urging multilateral development banks to do more. But, as we reported last week, there is controversy over the World Bank’s role to help nations struggling with devastating floods, heat, drought and other climate impacts, and whether its financing of new oil and gas projects is exacerbating the problem.

This controversy boiled over when the President of the World Bank, David Malpass, was labeled a climate denier by Al Gore and then dug the hole a little deeper later that day when he refused to acknowledge that the burning of fossil fuels is rapidly warming the planet (the video in this article is worth watching).?

Although Mr Malpass has since apologized for this remark, calls for his resignation picked up momentum when US presidential envoy for climate John Kerry endorsed his ouster. Pressure ratcheted up for the Trump appointee when the White House press secretary said “We disagree with the comments made by president Malpass. We expect the World Bank to be a global leader of climate ambition and mobilization, as well as significantly more finance for developing countries… We condemn the words of the president.”

No Nukes

Environmental groups, spearheaded by Greenpeace, have united to take legal action against the European Commission for allowing gas and nuclear energy in Europe’s list of permitted sustainable investments. The groups, including Client Earth and the WWF, contend that gas is the highest carbon emitter in Europe’s power sector, and that nuclear power uses huge amounts of freshwater, which results in negative impacts on biodiversity.

?“This fake green label is incompatible with EU environment and climate laws,” said Ariadna Rodrigo, of Greenpeace - adding: “Gas is a leading cause of climate and economic chaos, while there is still no solution to the problem of nuclear radioactive waste and the risk of nuclear accidents…”?

An opinion piece from Farhad Manjoo in the New York Times also took a negative stand on nuclear energy based on the costs and benefits: ?

“The 63 nuclear reactors that went into service around the world between 2011 and 2020 took an average of around 10 years to build. By comparison, solar and wind farms can be built in months; in 2020 and 2021 alone, the world added 464 gigawatts of wind and solar power-generation capacity, which is more power than can be generated by all the nuclear plants operating in the world today.”

The New York Times

Nature or Nurture??

Biodiversity loss is increasingly becoming a topic of interest for board directors and senior business executives around the world.?

A new McKinsey report looked at where Fortune 500 companies stood on the nature crisis. While 83% have targets related to climate change, a mere 5% set targets for biodiversity loss.

Is Climate Tech Recession Proof?

With economists predicting a global economic recession, investors look for safer assets like government bonds and blue chip companies.? Where does that leave climate tech?

Things are different now, according to Mark Cupta, managing director of Prelude Ventures. “2022 is on pace to eclipse every other year in venture-capital fundraising” with the trend “amplified” for climate investing, he says. Every climate startup that Prelude has recently backed has received highly competitive investor bids in funding rounds. “There’s still a very robust, potentially recession-proof, segment within climate tech for people who are trying to solve really hard problems,” he says.

Meanwhile, there’s now more money than ever being unlocked for cutting-edge solutions to global warming. The new US climate bill, which will provide $370 billion in climate spending, has plenty of incentives for solar and wind power, but also for nascent technologies, such as direct air capture and long-duration energy storage for the grid. It’s no surprise that academics and scientists are increasingly jumping ship to the climate tech world.?

“That makes it economic for [these startups] to manufacture and sell from day zero,” says Gabriel Kra, who is also managing director at Prelude Ventures along with Cupta.

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NOTABLE NEWS

• Fast Company publishes an excellent newsletter - not always on the sustainability beat - but still a great read.? In this edition they covered the Patagonia story we featured in our last edition.? It’s a great interview with business guru Jim Collins. This quote is priceless: I hope that more founders, before they get drawn into the "What everybody else thinks their company or business should be," start first with their own declaration of independence: This is our truth. This is what we hold self-evident. And do it. Do it early before we lose the ability to control our own destiny. Make your decisions in ways that allow you to not sell control or to fuel growth that you might not even want. And, then begin to build. And when people ask: What's your exit strategy? Boy, Chouinard just redefined that. This is like an existential exit strategy: He's saying: This is what my life is about.
• Yes, Climate Change Is Making Storms Like Hurricane Ian Worse: On his program Tuesday night, CNN’s Don Lemon had asked NOAA National Hurricane Center acting director Jamie Rhome about the effect climate change was having on the approaching storm. Rhome said he wanted to talk about the current situation facing Florida and that he would talk about climate change at a later time. Lemon tried again, asking about the link between climate change and increasingly intense hurricanes. “I don’t think you can link climate change to any one event.”?Conservative news outlets reacted with joy and framed this as a shutdown.? But, the National Oceanic and Atmospheric Administration predicts that, due to climate change, the public will see a continued rise in the frequency of Category 4 and 5 hurricanes in the years to come.??
• As the US Midterm elections draw near, the prognosticators take on the partisan divide in an article called Do Democrats And Republicans Agree On Anything About Climate Change And Immigration? Spoiler alert - they don’t
• Forbes reported a second year of stalled progress on the sustainable development goals.? While COVID was a factor, it was not the only barrier to progress on the global goals. Critically, according to the Sustainable Development Report 2022, which was authored by Jeffrey Sachs, Guillaume Lafortune, Christian Kroll, Grayson Fuller and Finn Woelm, the proportion of people in extreme poverty has substantially increased since 2019. This represents the first (and arguably most elemental) SDG. The goal related to decent work and economic growth has also seen regression.
• The SDG Challenge 2022 is an opportunity for research teams to develop innovative solutions relating to challenges associated with climate, biodiversity and the environment. Funding is available for collaborative research teams based in Ireland and Irish Aid partner countries. Teams will receive up to €300k and will work through a series of phases to develop their idea. An overall prize award of €1M will be awarded to the team that demonstrates the highest potential for transformative impact.
• Join the Climate Club!? Facebook and Bain have a new tool to help employees track their contributions to climate change.
• Deloitte, in collaboration with the World Economic Forum and the Climate Governance Initiative (CGI), launched its latest paper entitled, The Chairperson’s Guide to a Just Transition, discussing how boards can enable a #JustTransition and its importance to company strategy.?
• New York to Ban New Gas-Powered Vehicles by 2035, following California's Lead. The regulatory step will take New York closer to its?statewide goal?of 85% emissions reductions by 2050 from 1990 level.

NOTABLE PODCASTS

• This week’s Ezra Klein podcast covers how Joe Biden’s agenda has gone from a failed promise to real legislation. Taken together, the CHIPS and Science Act and the Inflation Reduction Act (along with the Bipartisan Infrastructure Act) have the potential to put America on a path to decarbonization, develop some of the most advanced and crucial supply chains in the world, and build all kinds of next-generation technologies. It’s hard to overstate just how transformative these plans could be if they are carried out in the right way.
• Jon Stewart’s “The Problem” Podcast discusses the Fifth Circuit Court’s recent ruling on the Securities and Exchange Commission (SEC). Could it signal the demise of the government as we know it???
• The World Can’t Tackle the Climate Crisis Without New Technologies. Green technologies must become cheap enough for every country to use them, says Bill Gates on Episode 3 of Zero, a new podcast from Bloomberg Green.