Happy Tuesday… blink and it’s February… Is pinch and a punch just an English thing?
In today’s edition:
🇨🇳 China’s win in offshore wind
💵 The cost of a green economy
🚢 Charging stations for ships
Big Business (2-minute read)
China is a global leader in wind power (but still has a coal problem)
Wind power… is a key to the clean power transition, especially offshore wind power. Offshore turbines reduce disturbance to people, are more energy efficient (wind levels are more consistent offshore) and cost-efficient (larger turbines can be used)
A problem of scale: 7 million square kilometres (km) of offshore farms are needed to power the whole world, currently we have just 7,000 (see picture).
Moving in the right direction: In 2021 China connected 17 gigawatts (GW) of offshore wind capacity to its electricity grid. For context, between 2015 – 2020 the rest of the world, collectively, added 14GW.
One step forward, two back? China still derives 84% of its energy from fossil fuels, with 1000+ coal fired power plants in operation with plans for more in 2022.
Good Biden, Bad Biden
Good – Support for right to repair:
Biden reaffirmed support for ‘right to repair’ giving owners of products, from smartphones to tractors, the freedom to choose how or where they repair that item without voiding the warranty = Longer product lifespans and Less waste. An executive order issued in July demanded companies (like Apple) to act or face consequences.
Bad – Court Revokes Oil and Gas Leases, Citing Climate Change
A federal judge on Thursday cancelled oil and gas leases of more than 80 million acres in the Gulf of Mexico. They ruled the government did not sufficiently take climate change into account when it auctioned the leases (The largest auction in US history). Now, the Interior Department must reconsider climate costs before deciding whether to proceed with the auction.
BlackRock enters the green Venture Capital (VC) world
After saying last week that the next thousand “billion-dollar start-ups will be in climate tech” Larry Fink, BlackRock CEO, has put his money where his mouth is. Blackrock just announced ‘Decarbonization Partners’ that aims to target late-stage venture deals focused on the clean energy transition. It will have an initial $600m in capital to invest.
What it means for VC? More choice for founders. More competition for smaller climate-focused venture capitalists who risk being squeezed out of deals.
🤖 Future of Tech (1-minute read)
Vertical Farming continues to grow
Vertical farming company, Plenty, has just raised $400m (the largest to date for an indoor farming company) with Walmart providing the funding. The company also signed a partnership with Walmart to provide vertically farmed produce to stores in California.
Why’s this important?
- Plenty’s tech means vertically farmed produce is cost-competitive VS traditionally farmed produce = more supermarkets will stock the produce
- Walmart is creating a new product category for vertically farmed produce = tapping into the market of conscious consumers
- Vertical Farms reduce risk to Walmart’s supply chain & ensures supply of seasonal goods all year-round without the extra food miles
A Shipping Group Has Launched the World’s First Offshore Charging Station
Challenge: The shipping industry emits roughly 1 billion metric tons of carbon dioxide per year – nearly 3% of global emissions. Unprecedented congestion at ports are leaving a record number of ships ‘idling’ in the water – continuing to consume 3 to 5 tonnes of fuel per day.
Opportunity: Shipping group Maersk is launching Stillstrom to eliminate idle emissions, by installing hundreds of full-scale offshore charging stations. Vessels outside the port will use electricity from charging stations, instead of consuming oil. The aim is to remove 5.5 million tons of CO2 within five years
Growth: The wider electric ship market is projected to grow from USD 4.7 Billion in 2021 to USD 16.2 Billion by 2030.
💡Deep Dive (1-minute read)
More and more governments and companies are committing to climate action. Yet serious challenges stand in the way of a transition to net-zero emissions. A report by McKinsey has analysed economic impact of a transition (focusing on capital allocation, costs and jobs) – here’s our high-level overview:
- More spending… An additional $3.5tn of investment will be needed each year to reach net-zero by 2050. That’s equal to half of global corporate profits in 2020.
- A rise in energy prices… as the power sector builds renewables and transmission capacity. The unit cost of electricity production could rise by 20% on average globally by 2050.
- Job losses & job gains… The transition could result in a gain of 200m and a loss of 185m jobs globally by 2050.Demand for jobs in the fossil fuel extraction and power sectors could be reduced by 9m, while 8m direct jobs would be created.
- The cost of delay: The economic and social costs will grow if there is a delay or an abrupt transition as this could result in a backlash from consumers.
The transition won’t be simple… and it’s going to require a global, coordinated effort. Everyone is going to feel the impacts and transition differently, alongside having different priorities, but we need all of them for a successful transition.
💭 Little Bytes
Quote: “3.6 billion people are still offline today, we need to use 21st-century infrastructure (mobility, broadband and cloud services) to get accessible and affordable technology and digital services for everyone.” Hans Vestberg, CEO, Verizon Communications
Stat: Decarbonising steel requires investment of $145bn a year on average for the next 30 years, and could push the cost of making the stuff up by 30%.
Watch: Solar farms on US Superstores could power 8 million homes
🗞 In other news…
- World’s first space sustainability rating launched (haha) to reduce space debris and ensure increasing space missions are safely and sustainably
- Nestle to triple cocoa supply chain sustainability funding, with focus on human rights and child labour
- HSBC has invested $100m in Breakthrough Energy Catalyst, Bill Gates’ accelerator programme focused on climatetech
- The use of insects as an alternative protein is rising, as concerns around climate change are providing bugs with a way forward with consumers.
- Bentley ringfences £2.5bn to develop EVs in UK and General Motors confirms $6.6bn investment in EV manufacturing
💸 Deal Room
- U-S baseed Plenty raises $400m from Walmart in Series E funding, in vertical farming’s largest funding to date
- H2Pro raised $75M in Series B funding for its disruptive way of producing green hydrogen from water
- Moss Earth raised $10M in Series A for their tokenized carbon credit, the MCO2, has
- ClimateTrade, the leading blockchain-enabled climate marketplace, has raised €7 million in a Pre-Series A
- Norway’s Heaten raises €6M in series A funding for its tech that makes industrial heat processes more efficient by capturing waste hear
