Weekly Highlights | From regenerative agriculture to Nord Stream 2 geopolitical implications

1. How Investors Can Drive Us to Net Zero​

By Fortune

• Following COP26, $130 trillions of assets under management are subject to net-zero pledges; now is the time to move from pledges to action, as there is a current huge gap of investment in decarbonising our economies

• Investments should targeted on two main areas: helping industrial gray assets transition to net-zero and accelerate the development of promising new low-carbon or decarbonisation technologies

• To create this context, at least three ways exist: climate activists should now use the attention they got from assets owners; create a net-zero leaders’ circles to encourage positive actions; create a climate ventures leaders circle

2. The Green Hydrogen Economy​

By PWC

• Demand growth will grow at a moderate, steady pace through niche applications until 2030. After 2030, demand growth will accelerate, particularly from 2035 onward

• The hydrogen demand breakdown per sectors can vary widely. For the European Union, the expected breakdown, as outlined in the European Hydrogen Roadmap, is 39% of hydrogen usage in the industry sector, 30 % in transport, 26 % in heating and power for buildings and 5 % power generation

• Hydrogen demand by 2050 could vary from 150 to 500 million metric tonnes per year, depending on global climate ambitions and the development of sector-specific activities, energy-efficiency measures, direct electrification and the use of carbon-capture technologies

3. Helping Farmers Shift to Regenerative Agriculture​

By Bain&co

• Globally, agriculture and waste represent about 15% of greenhouse gas emissions, so reducing that impact will be essential to meet the net zero goals of countries over the next few decades

• One thing working against widespread adoption is the perception that regenerative agriculture is something for small-scale, organic, or heirloom farms. But a recent, peer-reviewed natural climate solutions (NCS) study by Nature United and 16 research partners in Canada has shown outsized potential in regenerative agriculture

• Four main elements of regenerative agriculture are: cover cropping, nutrient management, reduced tillage and crop rotation

4. Managing Energy Crises in an Age of Climate Disruption​

By Project Syndicate

• A new Goldman Sach’s multi-year research brought a surprising conclusion: financial markets are internalising that high-carbon investments carry a risk premium thus putting an implied price on carbon; a trend reinforced by COP26 pledges

• However, on the demand side the situation is different; most recovery plans did not differentiate green and dirty economic activities and instead triggered a rebounce of demand for high-carbon industries

• Efforts should now also put on the demand-side, by both focus on energy efficiency (to counter current high energy prices and act on climate change) and reduce consumptions of high-carbon goods (such as cars, single use plastics)

5. Energy Monitor’s End-Of-Year Forecast: Solar and Wind​

By Energy Monitor

• According to the IEA the share of renewables in electricity generation will have to increase from 29% in 2020, to 60% in 2030 and 90% by 2050

• In addition to that, the IEA says annual capacity additions of wind and solar between 2020 and 2050 must be 5 times higher than the average over the past 3 years

• Nevertheless, the overall capacity increase for solar and wind between 2022 and 2030 is set to be approximately 50% below of what is needed

6. China’s Solar Giants Make a Bid to Dominate Hydrogen Power​

By Bloomberg Green

• Top solar manufacturers including Longi Green Energy Technology Co. are ramping up the production of electrolyzers, the equipment needed to make green hydrogen, the cleanest form of the fuel

• The hopes are that the government will introduce subsidy programs that set benchmark prices for hydrogen produced by renewables, and that the rising cost of emitting carbon in China could boost green hydrogen consumption

• Today, while the state-owned firms are making bigger bets across the board on the overall hydrogen infrastructures, private companies such as Longi and Sungrow Power Supply Co. for now are sticking with the more limited focus on electrolyzer development

7. Green Banks Can Take Climate Finance from Pledge to Project​

By GreenBiz

• Collectively, the members of the Green Bank Network have invested or committed $50.4 billion in climate projects since the first green bank was founded in 2012

• Today, 27 green banks exist in 12 countries, and an additional 20 jurisdictions are exploring some form of green bank solutions

• At COP26, 3 common themes were evident: public funds must help unlock international and local private capital; green mandates coupled with a flexible toolkit create impact; partnerships that leverage complementary roles are crucial

8. Nord Stream 2 Could Still Sabotage German-American Relations​

By The Economist

• Nord Stream 2, a recently completed 1,230km (764-mile) undersea pipeline for natural gas from Russia to Germany, is fiercely opposed by America’s congress

• Many American lawmakers fear that the new pipeline, which doubles Russia’s capacity to export gas to Germany, will increase Europe’s dependence on Russian energy

• Germany’s energy regulator suspended the certification process of the pipeline, claiming that to secure an operating license the NS2 consortium needed first to form a German subsidiary under German company law

9. The Major Energy Surprises of 2021​

By Timera Energy

• Decarbonisation accelerates beyond all expectations – structural inflection in policy & industry response

• Surge in energy prices – gas, power, carbon & oil prices surge as demand recovery rides up constrained supply curves

• Flexibility crunch comes into focus – increase in focus on flex requirement with policy action to support investment

• Upswing in LNG portfolio value – tightening market drives big value increase for flexible LNG portfolios

• Gas asset ownership transition – growing decarbonisation risks are a catalyst for asset sales to private equity & integrated traders.

10. Corporations Are Turning to Forest Credits in the Race to Go 'Carbon-Neutral.' Advocates Worry about 'Greenwashing.'​

By NBC News

• Big corporations are planning to plant tens of thousands of trees that suck greenhouse gases out of the air, allowing customers who buy its fuel to claim that their driving is carbon-neutral — at least on paper

• Still, there’s no single, universally recognized way to count how much carbon any given project keeps out of the atmosphere. If a company, for example, pays landowners not to cut down a forest they didn’t plan to cut down anyway, there’s no real savings for the planet

• On the other hand, the forest credit market is creating a pathway for a massive infusion of corporate cash into ecological projects that might otherwise go unfunded (e.g., dense forest restoration in India, agroforestry in Peru)

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