Axios Generate

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November 13, 2017

Good morning from Bonn, Germany! I'm here covering the UN climate conference that kicks into high gear today.

My latest Harder Line column reality checks the Trump administration's event happening today at 6:30pm Central European Time (or 12:30pm ET). You can catch a glimpse of it below, and then I'll hand things back to my colleague Ben Geman to get you caught up on the rest of the news.

Trump's conflicting climate agenda

BONN, Germany — President Trump has the potential for a pragmatic climate agenda, but his contradictory and vague policies are undercutting it. That problem will be on display at a conference here today, when the administration will argue that cleaner fossil fuels and nuclear power must be part of the world's solutions to climate change.

Why it matters: Trump's team here has a point: Most studies show that without nuclear power and technology making fossil fuels much cleaner, it's nearly impossible to cut greenhouse gas emissions to levels scientists say we must at reasonable costs. But the administration's broader posturing on the issue is not conducive to any coherent strategy.

Read the rest in the Axios stream here.

Musk vows Tesla semi truck will "blow your mind"

Coming Thursday: Tesla will finally unveil its prototype for an electric semi-truck, and as you can see from founder and CEO Elon Musk's Sunday afternoon tweet above, he's not letting the company's recent stumbles dampen his enthusiasm for hype.

Why it matters: The stakes are high for Tesla — and the future of petroleum and transportation. For Tesla, the unveiling arrives during a rough patch for the company, which is producing its mass-market Model 3 sedans far more slowly than Musk initially pledged and two weeks ago reported its biggest quarterly loss ever.

  • More broadly, significant electrification of the heavy-duty trucking sector in the coming decades could play an important role in curbing global oil demand.

What to look for Thursday: Questions confronting Musk's plan to enter the heavy-duty trucking market include...

  • Tesla's timeline for commercial production and projected vehicle costs.
  • How much range the vehicle will have.
  • The scope of autonomous features and other advanced technologies that enable "platooning" of multiple vehicles and other attributes.

Go deeper: Read our full story here. also has an in-depth preview here. Based on information that has dribbled out in past months and what can be expected based on Tesla's tech and approach, predicts...

  • "[A] tall, imposing cab inspired by the helmets worn by Imperial storm troopers in the 'Star Wars' movies that Tesla's designers watched growing up."
  • "Look for a day cab, intended for short- and medium-range work, with a range of up to 300 miles and, more likely, a range of somewhere between 150 and 225 miles."

Oil market news and views

It's so on: Reuters reports that OPEC and allied producers are likely to make a decision late this month on the planned extension of the production-limiting deal, rather than delaying the matter.

  • "United Arab Emirates Energy Minister Suhail bin Mohammed al-Mazroui said on Monday he saw no need for the decision to be delayed beyond the Nov. 30 meeting in Vienna. His Omani counterpart voiced confidence there would be an agreement this month," they report.

More OPEC: "Opec's in-house analysts have sharply raised their demand forecast for the cartel's oil in 2018, ahead of a key meeting of the group's ministers later this month," the Financial Times writes in a piece on the cartel's latest monthly market report out today.

Known unknowns with Aramco IPO: Via Bloomberg this morning, "Saudi Arabian Oil Co. is still waiting for a decision on how many of its shares will be offered to the public, or where the listing will be made outside of the kingdom, according to Chief Executive Officer Amin Nasser."

ISIS-controlled production: Over in our Expert Voices section, Princeton's Jacob Shapiro explains new research that uses satellite imagery to gauge declining production in areas controlled by ISIS in real time.

  • Why it matters: "Our study shows that ISIS has been highly ineffective in managing its oil fields, limiting its revenue from these valuable assets and forcing it to fall back on taxation and extortion for funding. This data can also help to shape plans for rebuilding area liberated from ISIS control by setting priorities for needing repairs and providing revenue projections for local economies," Shapiro writes.

Brazil: The Wall Street Journal has an interesting feature on a problem facing the Brazilian government — the government firm PPSA is about to begin receiving oil from offshore production without the related infrastructure to handle it.

  • From their story: "The situation, which officials are scrambling to resolve before the government receives its first 500,000-barrel boatload in February or March, underscores the complications of taking too literally the rallying cry of resource nationalists: 'The oil is ours.'"

On our radar this week: oil, ANWR, taxes

Oil, part 1: The International Energy Agency will release its latest monthly oil market report on Tuesday. This edition of the closely watched data and analysis on global markets will be the last before the late November OPEC meeting in Vienna, where ministers could make critical decisions on how they plan to extend the production-cutting deal.

Oil, part 2: The Senate Energy and Natural Resources Committee will mark up legislation Wednesday that would open the coastal plain of the Arctic National Wildlife Refuge to oil exploration.

  • Republicans are using the budget "reconciliation" process that enables legislation that's immune from filibuster, but it also procedurally ties ANWR to the fate of their wider tax legislation, which brings us to...

Taxes: Republicans in both chambers are seeking to advance competing tax code overhauls that have conflicting provisions on energy.

  • The full House is slated to vote this week on a plan that cuts the value of wind energy tax credits; kill credits for buying electric cars; and extends the availability of incentives for new nuclear projects. Today the Senate Finance Committee begins marking up a competing plan that does not include those provisions.

The really big picture: IEA will unveil its 2017 World Energy Outlook, a major analysis of all sorts of energy supply and demand trends through 2040, in London tomorrow. Watch this space for more.

Breaking: Global CO2 seen rising again after plateau

A big new report released Monday concludes that worldwide carbon emissions from fossil fuels and industry will move upward again by 2% in 2017, after a plateau for the last three years.

Why it matters: The report compiled by multiple scientists via the Global Carbon Project underscores how the world is not on track to achieve the level of emissions cuts needed in future years to prevent highly dangerous levels of warming.

In their words: In a summary and analysis posted at The Conversation, a number of co-authors of the 2017 Global Carbon Budget report state...

  • We believe society is unlikely to return to the high emissions growth rates of recent decades, given continued improvements in energy efficiency and rapid growth in low-carbon energies.
  • Nevertheless, our results are a reminder that there is no room for complacency if we are to meet the goals of the Paris Agreement, which calls for temperatures to be stabilized at "well below 2℃ above pre-industrial levels". This requires net zero global emissions soon after 2050.

Go deeper: The New York Times has an in-depth look at the new findings here.

On my screen: more climate news and GE dividend move

Some more Axios climate news...

Dems and nukes: Via Amy's reporting, a group of five Democratic senators attending a climate conference in Bonn, Germany, are conflicted over whether carbon-free nuclear power should be part of the solution." She's got more here.

Trump's known unknown: A White House official said the U.S. is not using the talks to describe what it might take to keep the U.S. in the Paris agreement. "We are not going to address that issue...We don't plan to talk about what those options could be," a White House official told reporters on a conference call.

  • Why it matters: The U.S. posture means continued uncertainty about Trump's comments that the country might be willing to remain in the 2015 agreement if the U.S. can secure better conditions. As we reported here, the administration has yet to put meat on the bones of the idea.

Some climate news from around the web...

Sales job: Via Politico, Democratic governors, lawmakers and others are "orchestrating a highly choreographed campaign to persuade world leaders that President Donald Trump doesn't speak for the United States on climate change."

The agenda: Bloomberg lays out five things their reporters are watching for this week. Among them: "German Chancellor Angela Merkel will face pressure at the talks to say how she plans to ensure her nation fulfills its CO2 pledge without shuttering coal plants."

Some market news...

GE news: General Electric announced this morning it will slash its dividends by 50% to free up capital — a move Steve Kopack points out is GE's 3rd dividend cut after its cuts during the Great Depression and Great Recession. More changes may be announced at its investor day starting 9am today, CNBC reports.