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Weekly Highlights | From the predictions for 2022 to the state of Climate Tech in 2021
Weekly Highlights | From the predictions for 2022 to the state of Climate Tech in 2021
illuminem
By illuminem
Dec 27 2021 · 5 min read

Illuminem Voices
Sustainability · Renewables · Oil & Gas

1. A World Overheating

By Council of Foreign Relations

  • The earth’s average temperature has risen more than 1°C (1.8°F) since the 1880s due to soaring GHGS emissions caused by human activity but some areas, including the Arctic, are heating more rapidly
  • According to Columbia University’s Earth Institute, global warming could kill as many as 83 million people over the next eight decades, a population equivalent to Germany’s
  • One factor that contributes to deaths is what is known as the wet-bulb temperature, Exposure to a sustained wet-bulb temperature of 35°C (95°F), has been identified as the limit for human survival

2. Predictions for 2022

By WoodMac

  • Carbon prices around the world will reach new highs: carbon prices in compliance markets, including the EU’s Emissions Trading System and China’s National Emission Trading Scheme, will continue to increase in 2022
  • Distributed solar installations will grow significantly in 2022, and drive the adoption of other distributed energy resources
  • China’s power surge will tighten renewable energy supply chains. China’s economic growth at over 8% in 2021 fired up soaring power demand: China’s electricity consumption grew by 10%, which was the fastest annual growth for any major economy in the recorded history of the industry

3. Coal 2021 Report

By IEA

  • Global coal demand fell by 4.4% in 2020 - the largest decline in many decades but less than initially expected - but coal demand grew by 1% in China in 2020
  • In India, stronger economic growth and increasing electrification are forecast to drive coal demand growth of 4% per year, adding 130 million tonnes to coal demand between 2021 and 2024.
  • With electricity demand outpacing low-carbon supply, and with steeply rising natural gas prices, global coal power generation is on course to increase by 9% in 2021, a new all-time high.

4. An Abundant Fuel, with Disruptive Potential

By S&P

  • Low-carbon hydrogen is set to play a disruptive role in decarbonising hard-to-abate energy applications. However, scaling up production dramatically is needed, as well as lowering transport costs. Overall, momentum is building for hydrogen
  • While gray hydrogen facilities and production rose slightly this year, clean hydrogen projects have proliferated in 2021. Europe is leading the way, with major funding coming from its new climate plan
  • Wide adoption is still bound to solving the refueling problem, while global trade is now mostly bilateral (North America and Europe are the two biggest markets). Many governments are introducing more ambitious hydrogen policies and strategies

5. Corporate Net Zero Policies: 5 Key Questions

By Lazard

  • How do you do the Net Zero Math? The Weighted Average Carbon Intensity (WACI) calculates carbon emissions relative to a company’s revenue, with the drawback of introducing operating volatility into the calculation, while the Enterprise Value Including Cash (EVIC) considers instead the size and capital structure of the company, which introduces market volatility
  • How ambitious are a company’s emission reduction targets? Many oil companies, for example, fail to consider the emissions from the end use of their products ̶ that is, burning fossil fuels ̶ in their own emissions calculations. Although the SBTi (Science-Based Targets initiative (SBTi)) has made meaningful progress in forcing standardized net zero targets, investors must be able to decode and compare opaque target metrics and incomplete disclosures
  • What are companies actually doing to achieve them? Some 2000 companies are committed to the SBTi, but more than one-third of emissions reduction plans set under the initiative are off-schedule. It’s time to move out of the planning stage and into the implementation stage

6. Battling for Bolivia’s Lithium That's Vital to Electric Cars

By The New York Times

  • Lithium is a basic component of lithium-ion batteries. Because of the metal’s light weight, long life, large storage capacity and easy recharging, demand is expected to grow exponentially over the next decade to power an expanding fleet of EVs. This year alone, prices for lithium compounds are up over 200 percent on several global markets
  • With a quarter of the world’s known lithium, Bolivia potentially finds itself among the newly anointed winners in the global hunt for the raw materials needed to move the world away from oil, natural gas and coal in the fight against climate change
  • EnergyX, a small start-up from Texas, has been incredibly short-listed as the potential technology provider that will fulfill Bolivia’s potential to be a global green-energy power

7. State of Climate Tech 2021

By PWC

  • Investment in climate tech is continuing to show strong growth as an emerging asset class, with a total of US$87.5bn invested over H2 2020 and H1 2021. This represents a 210% increase from the US$28.4bn invested in the twelve months prior. Climate tech now accounts for 14 cents of every venture capital dollar
  • The average deal size has nearly quadrupled in H1 2021 from one year prior, growing from US$27m to US$96m. Megadeals are becoming increasingly common and are driving much of the recent topline funding investment growth in climate tech
  • Mobility and Transport remains the most heavily invested challenge area, raising US$58bn, which represents two-thirds of the overall funding in H2 2020 and H1 2021

8. Carbon-Neutral LNG: Transition Fuel or Greenwashing?

By Energy Monitor

  • French oil major Total had delivered its first carbon-neutral LNG shipment to China from a liquefaction plant in Australia, using voluntary carbon credits coming from two carbon offset projects
  • However, all the credits Total retired from these projects are for historic reductions, with the Hebei Wind Power Project covering the last three months of 2015 and all of 2017, while the Kariba Forest Protection Project credits were for 2015.
  • “In the vast majority of cases, these are going to be cheap credits…They are going to take the cheapest, lowest-quality credits as long as these have been certified by a reputable organisation like the UN.”, says Guy Turner, founder and CEO of Trove Research

9. EU Leaders Fail to Agree on Energy Amid Carbon Price Dispute

By Energy Voice

  • The leaders of the 27 EU countries were not able to find an agreement on how to react to the unprecedented gas prices; most of them have already taken action at the national level
  • Discussions also spanned on emission costs, as countries such as Poland demanded a temporary opt-out of the European Emission Trading Scheme (EU-ETS), which sets a cap and a price on carbon
  • Support  for the EU-ETS  has been reiterated by many other countries, creating two blocs. Inclusion of natural gas and nuclear as clean energy sources have also bursted during discussions

10. Doing Business As If the Planet Mattered

By The Guardian

  • Shell walked away from 170 millions barrels of oil off the cost of Shetland, declaring the “economic case for investment” too weak
  • The company’s latest accounts feature this disclaimer: “Shell’s operating plans, outlooks, budgets and pricing assumptions do not reflect our net zero emissions target.”
  • In a recent review, the thinktank Carbon Tracker recently found that 70% of companies and 80% of auditors failed to disclose climate risk in their financial reports.
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