Category Archives: Energy & emissions

Green markets won’t save us

Markets are an unreliable guide for navigating a problem as large and complex as climate change.
By Katharina Pistor – How can one make wise decisions about a perpetually unknowable future? This question is as old as humankind, but it has become existential in light of climate change. Although there is sufficient evidence that anthropogenic climate change is already here, we cannot possibly know all the ways that it will ramify in the coming decades. All we know is that we must either reduce our environmental footprint or risk another global crisis on the scale of the ‘little ice age’ in the 17th century, when climatic changes led to widespread disease, rebellion, war and mass starvation, cutting short the lives of two-thirds of the global population.

The British economist John Maynard Keynes famously argued that investors are driven ultimately by ‘animal spirits’. In the face of uncertainty, people act on gut feelings, not ‘a weighted average of quantitative benefits multiplied by quantitative probabilities’, and it is these instinct-driven bets that may (or may not) pay off after the dust settles. And yet policy-makers would have us trust animal spirits to help us overcome the uncertainty associated with climate change.

Humanity has long sought to reduce uncertainty by making the natural world more legible, and thus subject to its control. For centuries, natural scientists have mapped the world, created taxonomies of plants and animals, and (more recently) sequenced the genomes of many species in the hope of discovering treatments against all imaginable maladies.

What maps, taxonomies and sequences are to chemists and biologists, numbers and indicators are to social scientists. Prices, for example, signal the market value of goods and services, and the expected future value of financial assets. If investors have largely ignored certain assets, the reason might be that they were improperly measured or priced. more>

The Texas Power Grid Failure Is a Climate Change Cautionary Tale

By Justin Worland – For scientists, the havoc wreaked by the extreme winter weather that hit Texas in mid-February dropping several inches of snow and leaving millions without power did not come as a surprise. Ten years ago, in 2011, energy regulators warned the state’s electric-grid operators that they were ill-prepared for an unprecedented winter storm. And for decades before that, climate scientists had cautioned that a warming planet would cause climate chaos, raising the average global temperature while driving unusual weather events like this one. For Texas, it was always just a matter of time.

Despite these warnings, the state was unprepared—which Texans realized as soon as the storm swept in. Equipment froze at power plants, leaving about half of the state’s electricity-generating capacity offline. Natural gas wells iced over, slowing the fuel supply that heats homes. Millions were left without electricity, at least one city turned off its water supply, and Harris County, where Houston is located, reported hundreds of cases of carbon monoxide poisoning as Texans turned on their own generators to warm up. “This shows a disastrous level of underpreparation,” says Daniel Cohan, an associate professor of civil and environmental engineering at Rice University in Houston, speaking to TIME shortly after he had lost water pressure. “We knew this weather event was coming … What went wrong?”

The catastrophe can be linked to a string of planning failures that didn’t take that threat seriously. Much of the electricity infrastructure in Texas wasn’t hardened-think of insulation and other protections that allow it to function in extreme winter weather. Several power plants remained offline for scheduled maintenance, ignoring weather forecasters’ warnings of the fast-approaching storm. And the storm disrupted the supply of fuel needed to run other such plants.

The cascade of failures in Texas signals what is perhaps the greatest challenge ahead in this climate-changed world: accepting that business as usual isn’t working. Across the planet, humans have built civilization to withstand the vagaries of a 20th century climate. The extreme weather events of the 21st century will look nothing like those that came before—and hundreds of years of past preparation will not suffice. “The future is not going to be like the past,” says Melissa Finucane, a co-director of the Rand Climate Resilience Center. “If we could just plan a little better, we could anticipate some of these problems.” more>

Updates from McKinsey

America 2021: Renewing the nation’s commitment to climate action
To America’s leaders, innovators, and changemakers; here’s how you can help build a low-carbon economy that is resilient, competitive, prosperous, and fair.
By Dickon Pinner and Matt Rogers – The new federal administration has arrived in Washington with ambitious plans to address the climate crisis—and in so doing, revitalize the US economy and reclaim a leadership position on the international stage. During their campaign, President Joe Biden and Vice President Kamala Harris highlighted “the opportunity to build a more resilient, sustainable economy—one that will put the United States on an irreversible path to achieve net-zero emissions, economy-wide by no later than 2050 […] and, in the process, create millions of good-paying jobs.”

Their vision recognizes that the global transition to a low-carbon economy is well under way. The cost of many clean-energy technologies fell significantly during the past decade—as much as 90 percent for some renewable-energy projects. The capital markets are funding the use of these technologies at historically low costs of capital, thereby accelerating scale-up investments. A climate-friendly policy tilt is taking hold in many places. With China, Japan, and the European Union having announced targets to achieve net-zero emissions, more than 110 countries, accounting for more than 70 percent of global GDP, have made net-zero pledges. Of the US states, 23 have established emissions-reduction goals and 12 have instituted carbon-pricing policies. Groups representing prominent American companies have endorsed the use of market-based mechanisms to promote emissions reductions. Some large businesses, along with four former Federal Reserve chairs (including the new treasury secretary), have voiced support for a nationwide carbon tax. These trends are creating possibilities for American leadership, innovation, entrepreneurship, competitive advantage, and economic growth.

With the wind at their backs, government agencies and private-sector organizations can continue advancing the new national climate agenda that’s been set in motion already. The stimulus and government appropriations bill of December 2020, which received bipartisan support, set out tax incentives and funding for energy innovation and climate-related programs. And within days of his inauguration, President Biden signed executive orders initiating the process to reenter the Paris Agreement, positioning climate as a foreign-policy and national-security issue and calling on federal agencies to coordinate an all-government push to cut greenhouse-gas emissions, purchase clean-energy technologies, support innovation, conserve nature, and create economic opportunities across America. 1 Making good on these intentions will require new information, products, operations, and market innovations from public officials and business leaders. To inform their work, this memo highlights four sets of practices with notable potential to deliver the prosperity, security, and social-justice outcomes that the administration has prioritized. more>

Updates from McKinsey

Optimizing water treatment with online sensing and advanced analytics
Overlaying real-time advanced analytics on data from online sensing can help to stabilize operations and increase capacity in water-treatment facilities.
By Jay Agarwal, Lapo Mori, Fritz Nauck, Johnathan Oswalt, Dickon Pinner, Robert Samek, and Pasley Weeks – Metals and mining companies are adapting to an operating environment in which water is highly regulated, experiences unforeseen supply shocks, and carries substantial social value. By 2024, water-operating expenses for these businesses are estimated to increase by a 1 to 4 percent compound annual growth rate (CAGR), with a 4 to 7 percent CAGR expected for water-capital spending. Consequently, these metals and mining companies have made significant investments—an estimated $15 billion in 2019 alone—to reduce water withdrawal and increase water efficiency in operations, as well as mitigate reputational risk.

Digital tools can optimize water-management operations—offering stability, reduced costs, and deferred expenditures for new capacity. This article describes the application of such tools in water treatment (see, “The five domains of water management”).

Central to sustainable operations is water reuse, wherein water is reclaimed after processing and treatment (to remove metals, reagents, or suspended solids). Reuse obviates the need for additional fresh water; it significantly reduces water-operating expenses and is critical to addressing low water availability in stressed areas. Anglo-American, for instance, has pledged to adopt techniques that will allow for more than 80 percent water reuse at their mining facilities, saving an estimated $15 million per year. more>

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Updates from McKinsey

Reimagining the auto industry’s future: It’s now or never
Disruptions in the auto industry will result in billions lost, with recovery years away. Yet companies that reimagine their operations will perform best in the next normal.
By Thomas Hofstätter, Melanie Krawina, Bernhard Mühlreiter, Stefan Pöhler, and Andreas Tschiesner – Electric mobility, driverless cars, automated factories, and ridesharing—these are just a few of the major disruptions the auto industry faced even before the COVID-19 crisis. Now with travel deeply curtailed by the pandemic, and in the midst of worldwide factory closures, slumping car sales, and massive layoffs, it’s natural to wonder what the “next normal” for the auto sector will look like. Over the past few months, we’ve seen the first indicators of this automotive future becoming visible, with the biggest industry changes yet to come.

Many of the recent developments raise concern. For instance, the COVID-19 crisis has compelled about 95 percent of all German automotive-related companies to put their workforces on short-term work during the shutdown, a scheme whereby employees are temporarily laid off and receive a substantial amount of their pay through the government. Globally, the repercussions of the COVID-19 crisis are immense and unprecedented. In fact, many auto-retail stores have remained closed for a month or more. We estimate that the top 20 OEMs in the global auto sector will see profits decline by approximately $100 billion in 2020, a roughly six-percentage-point decrease from just two years ago. It might take years to recover from this plunge in profitability.

At the operational level, the pandemic has accelerated developments in the automotive industry that began several years ago. Many of these changes are largely positive, such as the growth of online traffic and the greater willingness of OEMs to cooperate with partners—automotive and otherwise—to address challenges. Others, however, can have negative effects, such as the tendency to focus on core activities, rather than exploring new areas. While OEMs may now be concentrating on the core to keep the lights on, the failure to investigate other opportunities could hurt them long term.

As they navigate this crisis, automotive leaders may gain an advantage by reimagining their organizational structures and operations. Five moves can help them during this process: radically focusing on digital channels, shifting to recurring revenue streams, optimizing asset deployment, embracing zero-based budgeting, and building a resilient supply chain. One guiding principle—the need to establish a strong decision-making cadence—will also help. We believe that the window of opportunity for making these changes will permanently close in a few months—and that means the time to act is now or never. more>

The ‘circular economy’—neither safe nor sustainable

The circular economy holds out the hope of living within the planet’s resources. Turning aspiration into action is another matter.

By Vera Weghmann – A little over a year ago, schoolchildren across the globe embarked on huge strikes over the climate emergency. Our global economic system is unsustainable: continuous economic growth and endless consumption mean ever-increasing waste. Waste which is buried, dumped at sea or turned into ash pollutes the environment and creates the need to extract further raw materials.

The European Union’s ambition to move towards a circular economy, and in particular its Circular Economy Action Plan, should therefore be welcomed. The circular economy implies radical change to how production and consumption are organized—away from a linear model of growth (extract, make, dispose) to a sustainable alternative (recycle, reuse, remake, share). Waste then becomes a resource.

In a report commissioned by the European Federation of Public Service Unions (EPSU), I showed however that the circular economy does not operate of itself. Especially, waste management—central to the circular economy—is an essential public service. Unfortunately, the pay of workers in waste management is often low, working conditions hard and unpleasant and, on top of that, health and safety is often disregarded. The report highlighted that very little attention has been paid to workers operating essential waste services to keep society running and maintain a sustainable environment. In the EU action plan the workers—formal and informal—relied upon are not even mentioned. more>

We have to accelerate clean energy innovation to curb the climate crisis. Here’s how.

A detailed road map for building a US energy innovation ecosystem.
By David Roberts – “Innovation” is a fraught concept in climate politics. For years, it was used as a kind of fig leaf to cover for delaying tactics, as though climate progress must wait on some kind of technological breakthrough or miracle. That left climate advocates with an enduring suspicion toward the notion, and hostility toward those championing it.

Lately, though, that has changed. Arguably, some Republicans in Congress are still using innovation as a way to create the illusion of climate concern (without any conflict with fossil fuel companies). But among people serious about the climate crisis, it is now widely acknowledged that hitting the world’s ambitious emissions targets will require both aggressive deployment of existing technologies and an equally aggressive push to improve those technologies and develop nascent ones.

There is legitimate disagreement about the ratio — about how far and how fast existing, mature technologies can go — but there is virtually no analyst who thinks the current energy innovation system in the US is adequate to decarbonize the country by midcentury. It needs reform.

What kind of reform? Here, as in other areas of climate policy, there is increasing alignment across the left-of-center spectrum. Two recent reports illustrate this.

The first — a report so long they’re calling it a book — is from a group of scholars at the Columbia University Center on Global Energy Policy (CGEP), led by energy scholar Varun Sivaram; it is the first in what will be three volumes on what CGEP is calling a “National Energy Innovation Mission.” The second is from the progressive think tank Data for Progress, on “A Progressive Climate Innovation Agenda,” accompanied by a policy brief and some polling.

Both reports accept the International Energy Agency (IEA) conclusion that “roughly half of the reductions that the world needs to swiftly achieve net-zero emissions in the coming decades must come from technologies that have not yet reached the market today.” There are reasons to think this might be an overly gloomy assessment, but whether it’s 20 percent or 50 percent, aggressive innovation will be required to pull it off.

Both reports set out to put some meat on the bones of a clean energy innovation agenda. And they both end up in roughly the same place, with roughly the same set of policy recommendations. more>

Updates from Georgia tech

Unselfish Molecules May Have Given Rise to Life
New research from Center for Chemical Evolution demonstrates experimentally evaluates alternative model to ‘RNA World’ hypothesis, emphasizing collaboration and co-evolution
By Moran Frenkel-Pinter, Nick Hud, Loren Williams – It’s a question older than science: How did life begin? In modern biology, life depends on life to live. But how did the mutualistic relationship between different molecules – which led, eventually, to complex biological systems, like human beings, for example – actually come to be?

For many researchers, the answer lies within the ‘RNA World,’ a widely-accepted hypothesis in which self-replicating RNA proliferated, serving a dual role as both genetic polymer and catalytic polymer, long before the evolution of DNA and protein.

The RNA World model is an attractive cradle-of-life premise, according to Georgia Institute of Technology researcher Moran Frenkel-Pinter, “because it avoids the extreme improbability of simultaneous independent origins of two different types of polymers. According to that theory, over time the RNA World incrementally invented the ribosome, giving rise to the current biological system comprised of RNA, DNA, and protein.”

She adds, “it’s kind of a parsimonious idea, basically saying that RNA made everything. But there is a much simpler solution.” Frenkel-Pinter and her research partners have offered an alternative – the concerted evolution of polymers – of nucleic acids and proteins. “A Ribonucleoprotein World,” quips Frenkel-Pinter, a research scientist and former NASA Postdoctoral Fellow who works in the labs of Nick Hud and Loren Williams at Georgia Tech, and is the lead author of a recently published paper that provides experimental support for this model.

The paper, “Mutually stabilizing interactions between proto-peptides and RNA,” in the journal Nature Communications, describes the chemical linkage that could have been at play during the origins of biopolymers. Their results suggest that neither nucleic acids or proteins came first, but that RNA and proteins were selected together through a process of co-evolution. In other words, it wasn’t a single selfish gene competing for survival that drove evolution; it was the rising tide of collaboration between molecules from the very beginning. more>

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Is this Last Mile for the Million-Mile Battery?

Announcements from Tesla and CATL show that a long-lived, cobalt-free and competitively price EV and grid/home batteries may finally have arrived.
By John Blyler – The much discussed 1 million-mile (1.6 million kilometers) battery may now be a reality. As the name suggests, these batteries would last for 1 million miles without breaking down. Tesla, along with China-based Contemporary Amperex Technology (CATL), have announced such a battery that not only lasts longer but also costs less than $100/kWh and uses cobalt-free materials. Why are these two features important?

It has long been a metric for the success of electronic vehicles (EV) that their battery energy density be on parity with traditional gasoline-powered engines. Such a condition would allow EVs to compete with gasoline vehicles on both weight and range – especially the latter. This means that, if gasoline is 100 times more energy-dense than a battery, that a vehicle would need 100 lbs of battery to go as far as 1-lb of gasoline.

But past studies by the Argonne National Labs have shown that system efficiency is another key consideration when comparing EV and gasoline energy densities. The research lab noted that electric powertrains are far more efficient than powertrains powered by gasoline. In many cases, less than 20% of the energy contained in a gallon of gas actually gets converted to forward motion. After that power has been transmitted through a transmission and differential to the wheels, it would have suffered significantly more mechanical losses.

By contrast, an electric powertrain can be more than 90% efficient. This would suggest that the energy density of an EV battery could be far less than equivalent to a gasoline-powered vehicle and still come out ahead. more>

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Leadership Reconceptualized: A Compass for the Leaders of the New Global Era

By Vassili Apostolopoulos – Deconstructing the New Era, is a formidable task. As I am writing these lines, the world has nearly stopped, with more than 180 countries fighting the Coronavirus, imposing different forms of social distancing and lockdown measures. The pandemic of COVID-19 has changed the world in ways and to lengths that we can still not begin to fathom.

Economics, politics, international relations, and governance, on all levels seem to be fundamentally changing. The ways in which firms, governments, international organizations, societies, and even families and individuals operate will change forever. Until a fully-fledged and widely available vaccine alleviates the health risk and contributes to efficiently managing the crisis, social distancing, restrictive measures in work and travel, fear and insecurity, instability and uncertainty will be part of our lives. And, even after the vaccine, the major global effort of preventing the next pandemic, by building a sustainable early warning system with solid safeguards and rapid response mechanisms across the globe and within states and societies will need to become our top priority.

Averting the next Pandemic, is the foremost collective responsibility, for leaders of all fields; from politicians to doctors, from health experts to corporate leaders, from researchers to philanthropists; we all need to contribute to the race for a vaccine, for effective and accessible cures, but also, to develop the action plan which will change the habits and the vicious cycles that generate new viruses. In our interconnected world, where poor hygienic conditions in a wet market in China, can within months bring the world into a standstill, global governance undoubtedly requires an overhaul.

The same applies to dealing with the root causes of infectious diseases such as influenzas, the bird flu, and then the swine flu -the previous pandemic- for which we had been warned a year in advance, in 2008 and had failed to act. More systematic global monitoring, early warning and proactive prevention models, need to be developed on a global level. Crucial institutions like the World Health Organization and the United Nations will need to be revamped, strengthened and upgraded. Shortcomings in global leadership during the COVID-19 pandemic came at a great cost, and a major global crisis was treated very poorly and highly unsystematically in some of its most decisive phases.

Leadership cannot be a la carte, and global cooperation in the face of existential global crises cannot be elective. more>