Net Zero

1. Climate quiet
2. Ford brakes on EVs
3. Energy spats
4. ESG bounceback
5. Greener dog food

Most climate policies don’t work, and Grenada pioneers a new debt relief strategy.

Kamala Harris isn’t ready to break her climate quiet

Vice President Kamala Harris made only a fleeting reference to climate change and clean energy jobs in her acceptance speech for the Democratic presidential nomination on Thursday, capping a convention that has been muted on arguably the crowning achievement of Joe Biden’s presidency.

“The freedom to breathe clean air, drink clean water, and live free from the pollution that fuels the climate crisis” are at stake in the election, Harris warned. But she didn’t mention the Inflation Reduction Act and the domestic manufacturing renaissance it spurred, or give any indication of how her approach to energy and climate may differ from Biden’s, something many climate advocates had hoped to hear in the convention.

Climate is a third rail for the Harris campaign. Anything she might say about the need to curb fossil fuel use risks alienating swing voters, especially in critical oil and gas states like Pennsylvania. Conversely, pointing to the record-high oil and gas production achieved under Biden is clearly a non-starter with the climate activists that make up an important part of her base. So there’s little to be gained from raising the issue at all, especially since polling indicates that climate isn’t something that most voters care much about either way.

That puts the campaign in a predicament, because the most important and successful economic policy of the Biden administration, the IRA, was fundamentally a climate bill. But whereas Biden explicitly made fighting climate change a trademark issue, Harris seems more comfortable to let it play out in the background. Judging from the convention stage, the campaign’s strategy has been to minimize mentions of climate catastrophe; keep talk of IRA-related job growth fairly vague and less prominent than housing, inflation, and other issues; and delegate what climate conversation there is to surrogates like Interior Secretary Deb Haaland and Rep. Maxwell Frost (D-Fla.), both of whom focused on climate and the IRA in their speeches last night.

Ford brakes on EVs

Ford is throwing the brakes on its EV rollout, pushing back a new electric pickup to 2027 and scrapping plans for an electric three-row crossover.

The automaker’s current EV offerings simply aren’t profitable, CFO John Lawler told reporters: The company will now cut the share of its total capital spending dedicated to EVs from 40% to 30%, and take a writedown of at least $400 million on manufacturing hardware it already built. All US automakers have been frustrated by slower-than-expected growth in EV sales, and what looked like a major pivot in the industry to electrification now seems unlikely to arrive before the late 2020s. In the meantime, Ford will go ahead with a new passenger hybrid and a new electric commercial van, a sign that business fleets will likely be the first part of the US auto market to significantly give up on gasoline.

Energy spats

Ukraine’s threats to Russian energy infrastructure are straining its ties with Western allies. The German government is under pressure ahead of elections there to roll back military support for Kyiv after revelations about the role of Ukrainian officials in authorizing the sabotage of the Nord Stream undersea gas pipeline in 2022. Officials in Hungary, meanwhile, are growing frustrated by new Ukrainian restrictions on the passage of Russian crude oil through pipelines in its territory, which remains a vital source of energy for Hungary. And the head of the UN’s nuclear watchdog is planning to travel to Russia’s Kursk region to ensure that Ukraine’s incursion poses no risks to a nuclear power plant there. Gas traders in Europe are rushing to fill storage facilities in anticipation of cuts to natural gas shipments from Russia this winter, and met a goal to fill 90% of them 10 weeks ahead of schedule.

Nights of Net Zero — Powering the Future: Can the Grid Keep Up?

September 23, 2024 | New York City | Request Invitation

Join Semafor for an evening reception with conversations featuring David Hardy, Group EVP and CEO Americas, Ørsted and Kathleen Barrón, EVP and Chief Strategy Officer, Constellation. With growing demand for clean energy to power AI and its transformative benefits, the biggest companies are seeking new sources of power. What are the most efficient ways the energy sector can meet the moment and maintain clean, reliable energy for all consumers?

Nights of Net Zero — Climate Advancements & Innovations

September 25, 2024 | New York City | Request Invitation

Join Kara Mangone, Head of the Sustainable Finance Group at Goldman Sachs, and Mary de Wysocki, SVP and Chief Sustainability Officer at Cisco, for an evening of forward-looking discussions on climate finance and AI’s role in advancing low-carbon technologies. As AI enhances climate projects by forecasting risks and boosting energy efficiency, questions remain about whether its energy demands could outweigh the benefits. The conversation will address these concerns while exploring how to ensure investments reach the regions most impacted by climate change.

ESG bounceback

Global issuance of sustainability-linked loans and bonds in the first half of 2024, putting the green finance market on track to bounce back from a falloff last year. These types of loans and bonds, which companies use to finance emission reduction and other sustainability investments, reached nearly $2 trillion in 2021. But they fell off steeply after that as regulators in Asia, Europe, and the US began to set more stringent rules about what kind of finance can really count as green, said Coco Zhang, ESG researcher at the Dutch bank ING. Much more finance is needed for the energy transition, she said, but the recent fall is actually a good thing: “We are seeing a market that’s increasingly favoring quality over quantity.”

Greener dog food

An Israel-based climate tech company is helping one of Europe’s top pet food producers slash its carbon footprint. Brenmiller Energy, which makes large thermal batteries that convert renewable electricity into industrial-scale heat and steam, will build a $5 million, 30 megawatt-hour system for a Partner in Pet Food plant in Hungary. Pet food, including the meat and vegetables used and the production process itself, is highly carbon-intensive; researchers have found that a year’s worth of dry kibble for a medium-sized dog creates about the same emissions as two domestic roundtrip flights. The thermal battery system will allow the PPF plant to significantly reduce or possibly eliminate its use of natural gas, Doron Brenmiller, the company’s chief business officer, said.

Thermal batteries for factories often struggle to compete with gas on cost, Brenmiller said. But that’s changing as a growing number of grid operators in the US and Europe are starting to offer to pay battery companies to soak up excess renewable power from the grid at peak generation hours. Getting paid for grid balancing services in Hungary is what allowed Brenmiller to reduce what it will charge PPF for heat enough to make the deal pencil out.

New Energy

• Green tech now accounts for nearly half of all venture capital in Africa, a major shift on the continent from a few years ago.
• More than 100 Chinese oil and energy companies created a new alliance to speed up the production and use of green hydrogen.

Fossil Fuels

• Consol Energy and Arch Resources, two of the largest US coal companies, completed a $2.3 billion merger as part of a strategy to seize more of the global coal export market. Meanwhile, a mining firm in Australia agreed to sell a 30% stake in one of the world’s largest coal mines to Japanese steelmakers.

Finance

• Grenada became the world’s first country to use a natural-disaster clause to suspend debt repayments. Hurricane Beryl caused damage equivalent to around a third of Grenada’s annual GDP, and officials this week told bondholders that the country would defer upcoming payments on one of its only international bonds.
• Sustainable finance gurus want oil and gas companies to have easier access to money they can use to reduce their methane emissions.
• BlackRock voted in favor of just 4% of ESG-related shareholder resolutions at companies in which it is invested this year, compared to 47% in 2021.

Politics & Policy

• A group of Republican attorneys general that is among the biggest opponents of ESG investing has pocketed at least $6 million in donations from oil and gas companies and their lobbying groups.
• Out of 1,500 climate policies adopted by countries around the world, only about 4% have actually done anything to tangibly reduce emissions, a study found. Most effective: Carbon pricing.

• Harris’ ‘Goldilocks’ economic agenda.
• Single-issue climate policies less effective than mixed approach, landmark report finds.
• Russian mercenaries in Africa are increasingly active.