Oct 13, 2021

Axios Generate

🐪 Happy Wednesday! Today's Smart Brevity count is 1,254 words, 5 minutes.

📊 Data point of the day: 33%, the rise in second-quarter U.S. electric vehicle sales compared to the same period last year, per industry data.

🚨 Situational awareness: "The European Commission outlined measures on Wednesday the EU could use to combat surging energy prices, and said it would explore joint gas purchasing among countries as a way to cushion price spikes." (Reuters)

🎶 This week marks 50 years since The Who released a rather overlooked gem of a single that's today's intro tune...

1 big thing: A tough reality check ahead of COP26
Data: International Energy Agency; Chart: Will Chase/Axios

A major new report provides a stark warning ahead of the UN climate summit: Yes, clean-tech deployment is really surging, but energy systems are still transforming far too slowly to rein in global warming, Ben writes.

Driving the news: The International Energy Agency is out with its big annual World Energy Outlook, a 386-page trove of data and analysis. Here are some big takeaways...

  • Carbon emissions are bouncing way back. 2021 is on pace to bring the second-largest increase on record as fossil fuel use recovers from 2020's restrictions and economic slowdown.
  • Current targets would make progress. Check out the chart above. If nations meet their current pledges under the Paris Agreement and announced longer-term targets, energy-related emissions would decline by 40% by 2050, IEA projects.
  • But even that's way too rosy. Pledges and on-the-ground policies don't match right now. Under existing and announced policies, IEA projects global average temperatures to vault dangerously past the Paris targets to reach 2.6°C (4.7°F) above preindustrial levels by 2100 and keep rising.
  • A lot more investment is needed. Getting on an emissions-cutting pathway consistent with limiting warming to 1.5°C — the most ambitious Paris goal — would mean a tripling of annual investment in clean energy projects and infrastructure to nearly $4 trillion annually by 2030.
  • Procrastinating is not good. Consider this: IEA estimates that if nations implemented policies consistent with their existing pledges and targets, global fossil fuel demand would peak in 2025. Yet the transition to cleaner sources is still too slow to meet the Paris target of limiting temperature rise to "well below" 2°C (3.6°F) compared to preindustrial levels, and ideally to 1.5°C (2.7°F).

Threat level: "The world's hugely encouraging clean energy momentum is running up against the stubborn incumbency of fossil fuels in our energy systems," IEA executive director Fatih Birol said in a statement.

  • He said the UN summit must provide a "clear and unmistakable signal" that nations are committed to "rapidly scaling up the clean and resilient technologies of the future."

We've got more on the report here, and I also recommend this piece in Carbon Brief.

Bonus: The 2050 clean tech market
Expand chart
Data: International Energy Agency; Chart: Kavya Beheraj/Axios

OK, beyond all the dire warnings, the report delves into what IEA officials call a huge economic opportunity, Ben writes.

The big picture: It estimates the future market size for a subset of key technologies under two scenarios — nations' existing and announced policies versus an energy system consistent with holding warming to 1.5°C.

In that net-zero emissions pathway, the market for five clean technologies rises to well over $1 trillion annually by 2050.

What they're saying: "This is comparable in size to the current global oil market. This creates enormous prospects for companies that are well positioned along an expanding set of global supply chains," IEA said.

2. Google Cloud partners on climate and sustainability

Illustration: Sarah Grillo/Axios

Google Cloud is partnering with five sustainability-focused companies to offer public and private sector customers new ways of anticipating and reducing their climate risk exposure, among other applications, the company announced Tuesday, Andrew writes.

Why it matters: With more climate and sustainability-related data being generated than ever, a premium is being placed on finding ways to gain insights from the firehose of information.

  • Because of the immense volumes of data generated and Google's existing customers, the new partnerships could one day touch multiple facets of your daily life from bank lending practices that incorporate climate risk to Google Maps capabilities.

The details: The partners include CARTO, which will enhance data visualization tools from the Google Earth Engine, the company said.

  • A well-known partner signing onto this initiative is Planet, the Earth-imaging company, which will put its daily imaging onto the Google Cloud. The company generates about 25 terabytes of data per day, said Planet's Kevin Weil.
  • Also on the list is Climate Engine, which helps customers identify and reduce their top climate risks.
  • According to Kevin Ichhpurani, corporate vice president of Google Cloud, Climate Engine will pipe multiple datasets including on water use, agriculture and wildfire spread, to the Google Cloud. Other Cloud customers can then tap into this data.
  • Google Cloud is also partnering with Geotab, which helps manage vehicle fleets, and NGIS, which is bringing its satellite imagery and mapping platform that can illuminate company supply chains.
3. White House pushes climate services and flood reform

Sea surface temperature anomalies in the tropical Pacific on Oct. 12, 2021. (NOAA/Climate.gov)

The Biden administration on Tuesday rolled out a revamped version of its main climate science website, and launched into developing new tools to educate people about the climate risks they face, Andrew writes.

Why it matters: The push into "climate services" comes in response to a mandate from President Biden to get more actionable climate intelligence to local leaders and everyday Americans.

Driving the news: The redesigned climate.gov website has enhanced, artificial intelligence-driven search features to improve data access. It also has information aimed at teachers and a "climate resilience toolkit" designed for policymakers.

  • The site has long provided a forum for federal scientists to dissect climate trends (my favorite: the ENSO blog).

Details: The White House Office of Science and Technology Policy also is moving ahead with new climate services initiatives in coordination with NOAA and FEMA.

Yes, but: Defining climate services is not easy. "We use the sort of geeky expression of 'actionable,' " NOAA administrator Richard W. Spinrad told Axios in an interview.

  • "[It is] basically something that will allow you to make a decision, whether you are an insurance company, or a homeowner, or a farmer, or anybody who relies on environmental information, to be able to make decisions in a much more informed manner," he said.

Meanwhile, the administration issued a request for information to revise the National Flood Insurance Program's (NFIP) minimum floodplain management standards that apply to structures built in flood zones.

  • While NFIP has been revised through the years, these standards have stayed largely the same since 1976, despite increasing flood risks related to population growth and climate change.
4. Catch up fast on oil: Congress, spill risk, deals

Big Oil: The Washington Post, citing a key lawmaker, reports: "The CEOs of six major fossil fuel companies and trade associations will testify at a blockbuster hearing this month about their role in spreading climate disinformation." (WaPo)

Environment: "The 'increasingly likely' possibility of a massive oil spill from a decaying tanker stranded in the Red Sea could disrupt supplies of clean water to the equivalent of more than 9 million people, according to a new study." (CNN)

M&A: "Dealmaking in the U.S. oil and gas industry in the third quarter of 2021 fell from a two-year high in the previous quarter, according to data analytics firm Enverus on Tuesday, as the industry cools from post-pandemic consolidations and focuses on selling off non-core assets." (Reuters)

5. India's Tata Motors nabs $1 billion for EV plans

Illustration: Lazaro Gamio/Axios

Indian auto heavyweight Tata Motors is planning a major expansion of its electric vehicle lineup, staked by the big TPG Rise Climate fund and Abu Dhabi-based sovereign wealth fund ADQ, Ben writes.

Driving the news: Tata is creating a new unit that aims to develop a portfolio of 10 EVs over the next five years and, working with Tata Power, build out charging infrastructure in India, the company said.

The two funds are investing $1 billion in a new Tata EV unit and will hold an 11%-15% equity stake at a valuation of $9.1 billion.

Why it matters: It's the "first major fundraising by an Indian carmaker to push clean mobility," Reuters reports.

  • The story, quoting a top Tata exec, says the company is planning to invest $2 billion overall over the next five years.
  • It's also among the first investments from private equity giant TPG's climate fund, which in July said it raised $5.4 billion in its opening round and has major corporate backers.