Oct 23, 2020

Axios Generate

Ben Geman

Happy Friday. Today's Smart Brevity count: 1,179 words, 4.5 minutes.

🚨Situational awareness: "Russia doesn’t rule out delaying scheduled production hikes by the OPEC+ alliance, President Vladimir Putin said, the latest sign the cartel could restrain crude output for longer as the pandemic crimps demand again." (Bloomberg)

🎤And today marks the 1973 release date of Al Green's "I'm Still In Love With You," which provides today's intro tune...

1 big thing: Climate's arrival on the biggest stage

Photo illustration: Aïda Amer/Axios. Photo: Olivier Douliery-Pool/Getty

Axios' Amy Harder reports: The most notable part of Thursday’s presidential debate on climate change was the fact it was a featured topic and assumed as a fact.

The big picture: This is the first time in U.S. history that climate change was a pre-scheduled segment at a presidential debate, although the topic has gotten more air time lately.

  • It signals how the problem has become part of the fabric of our society. More extreme weather, like the wildfires ravaging Colorado, is pushing the topic to the front burner.

Flashback: Until now, climate change either was wholly absent from presidential general elections or debate was fleetingly focused on whether or not it is real — it is and humans are the driving factor, most scientists agree.

Our thought bubble: It’s a (good) sign that politics has finally caught up with reality and the debate didn’t focus on whether or not climate change is real.

  • But, it's important to note that Trump has largely denied the science and hired people with similar views to run the federal government, which is having a major impact on policy.

The intrigue: Moderator Kristen Welker of NBC asked how the candidates would create jobs while also tackling climate change.

  • She also asked about environmental justice, which aims to address the disproportional burdens placed on communities of color and the poor, such as living close to polluting facilities.

More highlights:

1. Trump asked Biden whether he would “close down the oil industry.”

  • Biden said, “I would transition from the oil industry ... because the oil industry pollutes significantly," which incited Trump to remark, “That’s a big statement.”
  • Quick take: Expect this to come back again in the remainder of the campaign.

2. The candidates’ sparring over whether Biden opposes fracking made another appearance. This cued Welker to ask whether Biden would rule out banning fracking.

  • Biden responded: “I do rule out banning fracking.” He said he would ban fracking of oil and gas on federal lands.
  • Quick take: Actually, his plan bans new leasing of oil and gas on federal lands (not current production).

Between the lines: When gasoline prices are high, that’s pretty much the only thing politicians will talk about when it comes to energy policy. With low prices, it affords the political room to talk about longer term problems like climate change.

Read more

2. Biden's "transition" tumult

Republicans are seizing on Biden's comment that he would "transition from the oil industry" and hoping it creates a political opening as Trump trails in the polls.

Driving the news: GOP officials and lawmakers, as well as conservative media, are circulating the comments. During the debate, Trump said Biden will kill the sector, adding: “Will you remember that, Texas? Will you remember that, Pennsylvania, Oklahoma?”

(Note: Pennsylvania produces very little oil but huge amounts of natural gas.)

The big picture: Biden, during the debate, said oil has to be replaced by renewable energy "over time" and criticized subsidies. Watch the exchange.

Where it stands: Biden's team addressed the comments after the debate, per AP.

  • "In a call with reporters Thursday night, deputy campaign manager Kate Bedingfield clarified that Biden was talking about eliminating oil subsidies when he said he would 'transition away from the oil industry,'" they report.
  • Biden, as he was boarding his plane home after the debate, said, "We’ll get rid of the subsidies of fossil fuels, but we’re not getting rid of fossil fuels for a very long time," AP writes.
3. Here comes Japan's climate vow
Data: IEA; Chart: Andrew Witherspoon/Axios

Japan's newly elected Prime Minister Yoshihide Suga is slated to announce a target next week of making the nation carbon-neutral by 2050, per reports in Nikkei, Reuters and elsewhere.

Why it matters: Japan is one of the world's largest carbon emitters, per International Energy Agency data, though far smaller than China, the U.S. and India.

The big picture: Japan's reported pledge comes a month after China vowed to be carbon neutral by 2060, and EU officials are working to put meat on the bones of their promise to achieve the same thing by 2050.

The intrigue: It will also require some huge changes over time to a Japanese energy mix heavily reliant on oil, gas and coal.

  • Bloomberg, citing a government official, reports that the plan will promote tech including offshore wind and batteries.
  • "Using ammonia and hydrogen as alternatives to coal and liquefied natural gas will also be a part of the push," they report.
4. An electric mystery: GM's Hummer demand
Source: Giphy

This much we know: Reservations for the first edition of GM's new electric Hummer revealed Tuesday night filled up in 10 minutes, according to spokesperson Mikhael Farah.

Driving the news: The page where you can plunk down $100 to reserve the $112,595 first edition, which arrives in late 2021, offers a waitlist. You can still reserve the less souped-up and less pricey versions going into production in 2022–2024.

What we don't know: Exactly how many reservations they took and, by extension, how many of the expensive first editions GM plans to produce. The company isn't saying, offering only that thousands are on the waitlist.

Our thought bubble: GM's refusal to disclose planned production volumes is likely a sign that the expensive, high-performance first edition is meant to build buzz and show off some technological concepts. It's probably not destined for high volume production.

What they're saying: "This week's splashy — and spendy — GMC Hummer EV launch is a perfect example of how mainstream and upstart automakers alike are willing to throw big punches in order to appeal to the typical Tesla tech-savvy, affluent male buyer," Edmunds' Jessica Caldwell said in comments circulated to reporters.

5. A coal giant's "exit strategy"

The nation's second-largest coal company is accelerating plans to pivot away from producing the type of coal used in power plants — a stark sign of that sector's irreversible decline.

Driving the news: Arch Resources reported a $192 million quarterly loss Thursday, and announced plans to steeply cut production from its mines in the Wyoming's Powder River Basin as part of its pivot toward coal used in metals production.

What they're saying: CEO Paul Lang said the company's undertaking a "systematic winding down" of its thermal coal operations, calling it the "right business solution in the event we are unable to find an appropriate buyer" for those assets.

  • Lang, in a statement alongside the earnings report, said they're undertaking a "careful and well-communicated exit strategy" with employees, surrounding communities and other stakeholders.

Go deeper: St. Louis-based Arch outlines 'exit strategy' to stop selling coal used for electricity (St. Louis Post-Dispatch)

6. Chart of the day: Cities' carbon curbs
Reproduced from the Brookings Institution; Chart: Axios Visuals

Let's spend another moment with the Brookings Institution study of U.S. cities' pledges to cut emissions and mixed results thus far, which we explored in yesterday's newsletter.

Driving the news: The chart above projects what happens if the 45 cities with both long-term targets and baseline emissions data actually implement their climate action plans.

  • The cumulative emissions keep rising, of course, but the total is substantially lower if cities achieve their plans.

Why it matters: "[A] large proportion of targeted emission reductions is not expected to occur until year 2030 or later," the study notes.

  • This time frame "does not necessarily align with the urgency and haste" called for by parties like the UN's climate science panel, it states.

Of note: Creating this kind of accessible long-term outlook requires a bunch of assumptions.

  • For instance, their model assumes that if a city's target year for achieving cuts is before 2050, its emissions stay constant after the target year.
Ben Geman