Oct 16, 2019

Axios Generate

By Ben Geman
Ben GemanAmy Harder

Good morning! Today's Smart Brevity count: 984 words, ~ 4 minutes.

And this week in 1973, The Wailers released "Burnin'," which provides today's classic intro tune...

1 big thing: Takeaways from the climate debate that wasn't

Illustration: Aïda Amer/Axios

The total absence of energy and climate questions in last night's Democratic debate didn't prevent the topics from surfacing in noteworthy ways onstage and in the surrounding hubbub.

1. Some campaigns saw an opening. Bernie Sanders wove climate into several answers and attacked fossil fuel CEOs who "know full well that their product is destroying this world."

  • His campaign tried to make sure people noticed. Policy director Josh Orton tweeted about Sanders' "preemptively" raising it and argued, "Bernie is the climate candidate."

And billionaire activist Tom Steyer was clearly going to say something about climate — a big focus of his work — in the low-polling hopeful's first debate.

During a stretch about Russia, Steyer pivoted to call climate "the most important international problem that we're facing."

  • Steyer noted the U.S. can't solve the crisis alone but will have to lead on several fronts. He said the U.S. needs to work with allies and "frenemies." (Checkmate on the youth vote!)

Between the lines: I doubt this was spontaneous. Moments after his comments, Steyer's campaign emailed around his international climate plan released last month.

  • Why it matters: There were scattered references from other candidates, too. Politically, the appeals signal the topic's importance to the primary base.

2. Elizabeth Warren wants to break up big oil. That goal arrived in passing when she was asked about her goal of breaking up tech giants.

"We need to enforce our antitrust laws, break up these giant companies that are dominating, big tech, big pharma, big oil, all of them," said Warren.

  • Why it matters: Warren is now the co-frontrunner with Joe Biden. It's another sign of the aggressive posture Warren has staked out, alongside her call to ban fracking "everywhere" (which can't happen without Congress).

3. People are mad. Lots of activists and some journalists (among others) bashed debate hosts CNN and The New York Times for asking nothing, given the extraordinary stakes.

And Washington Post media analyst Erik Wemple said via Twitter: "Tonight's proceedings are sounding like a convincing argument that there really should be a dedicated climate-change debate."

  • The intrigue: This reopens the wounds over the Democratic National Committee's rejection of calls to sanction a climate-specific debate.
  • Quick take: The omission surprised me, because the NYT is institutionally committed to climate coverage. CNN held a 7-hour candidate town hall on climate on Sept. 4, so maybe that lowered the odds.
2. A little more on Warren and big oil

Warren's campaign tells me that one of her existing policy proposals would create pressure on major oil-and-gas companies to splinter.

The intrigue: They pointed to her legislation that would require detailed disclosures from publicly traded companies about climate change.

Under her bill, filings with securities regulators would describe risks to the company from policies that would force steep emissions cuts consistent with holding global temperature rise to 1.5°C.

Why it matters: The campaign argues that this would lead to so-called stranded oil and natural gas reserves that would create big financial liabilities for energy companies.

The idea of stranded assets is controversial and beyond the scope of this blurb! And achieving emissions cuts consistent with 1.5°C is looking quite unlikely.

But those huge caveats aside, the campaign argues that this risk would push companies to break apart.

What they're saying: "If oil companies are required to disclose this information to investors, there will be enormous investor pressure on these companies to break up so that the non-fossil fuel parts of these companies would not be taken down by likely losses in the fossil fuel parts," Warren's campaign said.

Go deeper: Elizabeth Warren wants a climate-friendly SEC

3. The carbon footprint of SUVs
Expand chart
Reproduced from IEA; Note: Other passenger cars refers to internal combustion passenger cars excluding SUVs; Chart: Axios Visuals

A new International Energy Agency analysis looks at carbon emissions from the global growth in SUV sales and calls it "nothing short of surprising."

Why it matters: Wringing carbon out of transportation is vital to fighting climate change and that's going to be harder if SUV sales keep growing fast.

The big picture: SUVs were the second-biggest contributor to CO2 emissions growth after electric power during the period from 2010 to 2018, the analysis shows.

SUV growth is eclipsing gains from improving mileage in smaller vehicles and the emergence of EVs (which are currently a tiny slice of global sales), IEA said.

Threat level: "If consumers’ appetite for SUVs continues to grow at a similar pace seen in the last decade, SUVs would add nearly 2 million barrels a day in global oil demand by 2040, offsetting the savings from nearly 150 million electric cars," IEA said.

By the numbers: There are over 200 million SUVs on the roads worldwide, up from roughly 35 million in 2010, according to IEA.

  • In 2010-2018, SUVs accounted for all of the 3.3 million barrels a day of growth in oil demand from passenger cars.
4. Catch up fast: Shale, PG&E, climate

Oil: Bloomberg looks at signs piling up that the U.S. shale surge is losing steam. "America’s shale boom got the world accustomed to soaring production. Now growth has slowed, and a cloud has formed over the industry," it reports.

Climate: The Financial Times ($) reports that developers hoping to use expanded tax credits for carbon capture projects are facing a big hurdle: time.

"[T]he clock is ticking for prospective projects as the US tax authority takes months to write rules for the programme. New projects using the credit, known as 45Q after its chapter of the tax code, must start construction before January 1, 2024," they report about rules for credits available via the 2-year-old tax law.

Utilities: Via The San Francisco Chronicle, "PG&E Corp. has lined up more than $34 billion in debt financing to help with its plan to exit bankruptcy protection and pay victims of the deadly wildfires caused by its power lines."

  • Why it matters: Their piece notes that PG&E is competing with a plan from fire victims and bondholders who want to take control of the power giant.

Aramco IPO: Per Bloomberg, "Advisers working on Saudi Aramco’s mammoth share sale may split a fee pool of as much as $450 million, according to people with knowledge of the matter, making it one of the biggest IPO pay outs globally."

One cool thing: "Earth as Art"
Screenshot of U.S. Geological Survey tweet

I've just discovered an amazing collection of images from the U.S. Geological Survey's Earth Resources Observation and Science Center.

Check it out.

Ben GemanAmy Harder