The Quest for Green Steel, The Promise of Natural Hydrogen, Fertilizer Giant Flirts with Fuel, Renewables Fuel Billionaire Industrialists in Asia

Fellow agents of change,

The holiday season is full swing and in that spirit I just returned from a team offsite and holiday party for 8090 Industries up in New York City this week as I’m sure many of you are doing something similar across the country and around the world. So in this busy season of deadlines, wrapping up final projects and days of travel, I thought we’d get right to it, but leave you with one special quote I came across this week that struck a chord with me and it’s in regards to talent versus genius.

“Talent hits a target no one else can hit. Genius hits a target no one else can see.” — Arthur Schopenhauer

WHAT CAUGHT OUR EYE:

- ?? The Trillion-Dollar Quest to Make Green Steel

- The Rise of a Homegrown Energy & Mining Powerhouse from Southeast Asia

-?? Why The Residential Solar Industry Is In Danger Of Imploding

- Natural Hydrogen: A Vast Source of Clean Energy, Buried Deep Underground

- Kinterra Capital’s Debut $565M Fund to Support Mining for Battery Metals

- Oil and Gas Companies Spill Millions of Gallons of Wastewater in Texas

-?? The Texas Permian Basin is Ground Zero for Billions of Dollars Worth of Zombie Oil Wells

- Fertilizer Companies Are Betting on Ammonia as a Low-Carbon Fuel

-?? Meet the Thai Billionaire Industrialist Betting Big On Renewable Energy

WHAT CAUGHT OUR EAR:

?? The Race for Commercial Nuclear Fusion - Packy McCormick

t’s here and it’s in this decade. One of my favorite writers and thinkers, Packy McCormick has been doing a series on nuclear, covering advanced fussion the past few episodes. With a growing chorus of people who believe that if we’re going to meet the demand for 3-5x the amount of energy we use today, and do it with clean energy, we’re going to need more baselod renewablew power. And that as humanity climbs the Kardashev Scale – the framework for measuring a civilization's level of technological advancement based on the amount of energy it can use – fusion is going to be our ladder. In this episode, Packy covers the basics of fusion energy – what it is, how it works, why it matters, how progress is measured, and what the main approaches are for all those who are interested in getting the baseline.

WHAT CAUGHT OUR EYE:

The Trillion-Dollar Quest to Make Green Steel: To start things off, I really enjoyed reading this incredible deep dive by Maria Gallucci, of Canary Media. Globally, producing steel generates as much as 9?percent of human-caused CO2 emissions every year — more than any other heavy industry, including cement and chemical production.?Part of the reason is simply that manufacturers make so much of it: nearly 2?billion metric tons of the stuff per year. The grayish alloy forms the hulls of cargo ships and parts of airplanes. It’s in buildings, bridges and roads; in vehicles, appliances and cookware. In 2022, the global iron and steel market was valued at nearly $1.7 trillion.

“A relining project represents a?crucial crossroads for steel producers. Companies can either spend hundreds of millions of dollars to prop up existing dirty facilities, or they can choose to develop and build cleaner steel technologies, said Hilary Lewis, steel director at Industrious Labs. This is a?moment when companies have the opportunity to make a?different investment in a?new facility, one that will have a?longer lifespan and make a?fossil-free steel product,” Lewis said as our minibus drove past slag piles and smokestacks.”

The Rise of a Homegrown Energy & Mining Powerhouse from Southeast Asia: Hilmi Panigoro is President Director of Jakarta-based Medco Energi Internasional, known for its oil and gas operations and this story showcases his meteoric rise as a homegrown Indonesian energy industrialist penned by none other than Ardian Wibisono and Gloria Haraito of Forbes. Back in July, copper and gold miner Amman Mineral International launched its IPO on Indonesia’s stock exchange, which with $710 million, was the largest IPO in the country this year. Hilmi’s company Medco owns 21% of Amman, a stake that has helped broaden the company out of its base in fossil fuels. Add to the mix its expansion into renewable energy, with projects in geothermal and solar, and Medco today is a vastly different company from its roots, emerging as a diversified homegrown energy and mining powerhouse in Southeast Asia, with operations in nine countries.

“The bigger we are, the thirstier we become” - Hilmi Panigoro” he says in an interview in the penthouse on the 55th floor of The Energy, a skyscraper that his family partly owns and located in the heart of one of Jakarta’s main business districts.

Why The Residential Solar Industry Is In Danger Of Imploding: The residential solar market is a $30 billion industry built on a shaky foundation of cheap money, questionable accounting and aggressive claims for federal tax credits. With money no longer cheap, subsidies a matter of politics and swirling allegations of fraud, a collapse could be coming soon. This story, penned by none other than Christopher Helman of Forbes brings this phenomenon to life through the story of Sunnova and its founder, John Berger. At 50, William “John” Berger, CEO of Sunnova Energy International, is a Texas-born Aggie engineer with a Harvard MBA who has built Sunnova into the nation’s second-largest residential solar power developer, with 2,000 megawatts of generation on the rooftops of 390,000 homes. Sunnova has lost $330 million on $722 million in revenue in the last 12 months. Its shares are trading around $10, off 80% from their 2021 high. Wall Street is nervous about its bonds: Its $400 million 2021 senior unsecured debt issue, maturing in 2026, initially paid 5.75%, but now yields 14%—high even for junk. But the big test, Berger says, will come if there’s a recession or difficulty raising money (which he fears more than high rates). In the worst case, he says, he could slash costs by 50%, stop seeking new business and fire himself.

Natural Hydrogen: A Vast Source of Clean Energy, Buried Deep Underground:

In the rocky soil of Lorraine, a former coal mining region near the French-German border, scientists guided a small probe one recent day down a borehole half a mile into the earth’s crust. Frothing in the water table below was an exciting find: champagne-size bubbles that signaled a potentially mammoth cache of so-called white hydrogen, one of the cleanest-burning fuels in nature. The discovery by Mr. Pironon and another scientist, Philippe de Donato, both members of France’s respected National Center for Scientific Research, caused a sensation in France, where the government has vowed to become a European leader in clean hydrogen. Natural hydrogen, also known as white hydrogen because of its purity, could be a game changer, scientists say, because it is a potential source of clean energy continuously generated by the earth. Hydrogen reservoirs form when heated water meets iron-rich rocks. According to the U.S. Geological Survey, just a small fraction of these deposits could provide enough clean energy for hundreds of years.

“Hydrogen is magical — when you burn it you release water, so there are no carbon emissions to warm the planet,” said one of the scientists, Jacques Pironon, a senior researcher and professor at the University of Lorraine. “We think we’ve uncovered one of the largest deposits of natural hydrogen anywhere in the world.”

Kinterra Capital’s Debut $565M Fund to Support Mining for Battery Metals: Switching the global economy to run on clean energy instead of fossil fuels depends on a?massive ramp-up in minerals extraction to supply batteries, solar panels, transmission lines and more. For instance, even here at 8090 Industries, we’ve incubated and backed a company focused on onshoring production capacity for synthetic graphite battery anodes for EVs (which today is nearly completely dominated by China’s interests and supply chains). This has a?lot of people worried that a?lack of access to minerals will eventually hold back progress on clean energy. But the founders of new investment firm Kinterra Capital aren’t just fretting about it: They’re investing in projects to produce more of the minerals and chemicals that underpin crucial clean energy technologies.

“We are attempting to change the very things that move and power us: We’re going from fossil fuels to materials,” Toor said of the global energy transition. But, he added, “The supply chains for the materials, especially the supply chains in stable jurisdictions in the Western world, are broken and fragmented.”?

Oil and Gas Companies Spill Millions of Gallons of Wastewater in Texas A recent report conducted by Inside Climate News marks the first-ever public analysis of produced wastewater spills in Texas and found companies have spilled nearly 150 million gallons of toxic, highly saline wastewater in Texas over the last decade.?Where possible, companies use vacuum trucks to suck up as much spilled water as they can. But only about 40 percent of the water reported spilled from 2013 to 2022 was recovered.

“Both conventional oil and gas drilling and hydraulic fracturing, or fracking, rely upon large quantities of water, sand and proprietary chemicals, some of which are toxic, to free the oil and gas from geologic formations deep underground. Produced water is the liquid waste that comes back to the surface and contains both the proprietary drilling fluids and naturally occurring hazardous compounds from the earth, including arsenic and organic compounds like benzene, a carcinogen. The highly saline water can render land barren for years. Residents have filed lawsuits detailing damages from contaminated well water to poisoned cattle.

The Texas Permian Basin is Ground Zero for Billions of Dollars Worth of Zombie Oil Wells: As oil and gas companies weathered volatile oil prices the last few years, many halted production. More than 100,000 oil and gas wells in Texas and New Mexico are sitting abandoned and idle. Of these, there are about 7,000 abandoned wells that the states are now responsible for cleaning up. A conservative estimate of the cleanup cost? Almost $1 billion. And that doesn’t consider the environmental fallout. Written by Clayton Aldern, Christopher Collins, and Naveena Sadasivam of Grist, this is a fascinating look into the marketplace of abandoned wells and the work the government and private sector is taking to plug them up and what the future could hold. This challenge is a key reason why we here at 8090 Industries view abandoned oil wells as critical infrastructure that can be re-tulized for other opportunities, specifically showcased through our work with our portfolio company Gold Hydrogen - which uses engineered microbes paired with the remaining hydrocarbons reimagining in abandoned oil wells to produce high throughput hydrogen for less than $1/kg.

“The uncertain outlook means that independent estimates of the cleanup costs of Texas’ wells alone have ranged from a conservative $168 million to a mind-boggling $117 billion.

Fertilizer Companies Are Betting on Ammonia as a Low-Carbon Fuel: The logo of Illinois-based CF Industries, one of the world’s biggest fertilizer makers, used to be a stylized cornstalk meant to represent the bounty of the harvest. Then a few years ago, the company changed its logo to a cluster of triangles meant to represent an ammonia molecule. The logo change signaled a historic strategy shift at CF—and is part of a surprising development that has propelled fertilizer companies, and the ammonia they make for their products, to the bleeding edge of a global energy transition toward low-carbon fuels. Proponents say ammonia is one of the easiest alternative fuels to ramp up, and that it could eventually help drive electric generators, power cargo ships or even prove useful in making jet fuel.?There are still obstacles to overcome before that happens. One is that while ammonia burns clean, the method of production generates a lot of carbon emissions. So fertilizer companies, which already make much of the ammonia that is traded around the world, are positioning themselves for that budding clean-energy market by taking steps to reduce those emissions and negotiate supply deals. Penned by Phred Dvorak of WSJ, this was an eye opening take into how one of the world’s leading fertilizer players are thinking and the steps they are taking in the energy transition.

“Agriculture continues to be a critically important part of our business,” says Tony Will, CF’s chief executive officer. But the company also is seeing an “expanding belief and movement toward using decarbonized ammonia as a clean energy source,” he says.

The Rise of a Thai Billionaire Industrialist Betting Big On Global Renewable Energy: Harald Link, chairman of storied B.Grimm group, methodically describes the rapid repositioning of one of Thailand’s oldest (Founded in 1878) companies for a low-carbon future: After three decades of firm footing in Thailand’s power business, B.Grimm is embarking on a massive expansion drive to capture growth opportunities in renewable energy outside its home turf. The third-generation Link is looking overseas to double the renewable projects in its portfolio, including wind, solar and hydro, to 50% of its power capacity. That’s part of an ambitious $2+ billion plan to boost listed flagship B.Grimm Power’s total generating capacity to 10,000 megawatts (MW) by 2030 from a current 3,830MW and he is 100% convinved he can make it happen.

AMPED UP

By the end of the decade, B.Grimm Power plans to nearly triple capacity to 10,000MW.

“One thing which is very important for us and me personally, is we always like to build capacity. Building something from scratch so that we can contribute to every single part of the process in building a power plant. Of our current pipeline, almost all are greenfield projects.”

About Rayyan Islam Rayyan Islam is the co-founder and General Partner of 8090 Industries, the leading partner and investor for industrial breakthrough technologies focused on decarbonization and national security. The companies Rayyan’s invested in, sourced and advised have grown to over $8B in private market value. Rayyan has led investments in groundbreaking companies like EquipmentShare, Astranis, Infinium, Quaise, Regent, Living Carbon and Liberation Labs, and serves on the Boards of Oklo, Cemvita, Circ, Maple Materials and is a co-founder of Gold Hydrogen, a producer of abundant clean hydrogen from microbes and old oil wells for less than $1/kg. Rayyan was recognized by Business Insider as one of the top 100 early-stage investors of 2023, alongside Peter Thiel and Vinod Khosla and?amongst the most powerful seed stage climate tech VCs by Fortune Magazine. As a frequent speaker on venture capital and climate technologies, Rayyan has spoken at NYU, Stanford, UT Austin and the United Nations and his work has been featured on CNBC, Bloomberg, Wall Street Journal, Forbes, Wired, Yahoo Finance and more.

Influenced by his family upbringing in Bangladesh, he personally witnessed the ramifications of energy insecurity and climate change at a young age and its impact on communities around the world. Determined to make a serious dent on the issue, Rayyan has supported a cadre of climate technology solutions, drafted policy recommendations to President Joe Biden’s climate transition team and founded the decarbonization focused newsletter Decarbon Weekly, which counts C-suite executives, leading climate scientists, members of state and local governments, founders, investors and foundations amongst its thousands of subscribers.

Rayyan lives in Dallas, Texas with his wife, son and daughter.