Uncategorized – Page 65 – The Global Carbon Fund

FortisBC Launches $50 Million Energy Retrofit Pilot to Cut Old Homes’ Emissions

March 22, 2024/in Uncategorized /by

FortisBC Energy Inc. (FortisBC) has initiated a massive $50 million pilot project, with plans of investing up to $700 million, aimed at reducing energy consumption in older homes and multifamily housing units across British Columbia. This endeavor is crucial for achieving the province’s climate action objectives.

FortisBC partners with Metro Vancouver Housing and residents from the Lower Mainland and Southern Interior regions. The company has enrolled 20 single-family homes and 4 apartment buildings in a deep energy retrofit pilot program.

Deep energy retrofits involve extensive, whole-home upgrades designed to cut energy use by at least half.

Retrofitting BC’s Aging Homes

Buildings contribute to carbon emissions, representing 15% of global emissions while responsible for about 40% of global energy-related emissions. In the U.S, they account for over 30% of all GHG emissions.

Buildings comprise slightly over 10% of British Columbia’s GHG emissions. In response, the Province of B.C. has established a target of reducing GHG emissions in the building and communities sector to 59% to 64% of 2007 levels by 2030.

However, addressing this goal is particularly challenging with older homes and apartment buildings. That’s because many were built before energy efficiency standards were implemented in the National Energy Code for Buildings in 1997.

Given that a significant number of these buildings will remain in use until 2050, deep energy retrofits are necessary to meet these emission reduction targets.

George V. Harvie, Chair of the Metro Vancouver Board of Directors, echoed the importance of reducing emissions from buildings. He noted that it’s one of the main ways that they will reach their goal of becoming a carbon-neutral region by 2050.

Metro Vancouver Housing ambitiously aims to cut emissions from buildings by 45% compared to 2010 levels over the next decade. Partnering with FortisBC on deep energy retrofit projects provides an opportunity to explore and implement new technologies to enhance energy efficiency, reduce GHGs, and improve the resilience and comfort of buildings for tenants.

FortisBC’s Bold Initiative Pioneers Energy Efficiency

Throughout the multi-year pilot study, FortisBC will assess the energy savings, customer satisfaction, and overall costs associated with each phase. The insights gained from this initiative will be invaluable for industry stakeholders, policymakers, and FortisBC itself.

They will inform strategies to ensure older housing units can meet the evolving needs of residents as the province progresses towards a net zero future.

Joe Mazza, Vice President of Energy Supply and Resource Development at FortisBC, emphasized the significance of this initiative, stating:

“To our knowledge, this is the largest targeted, real-world study of deep energy-efficiency upgrades in B.C. homes, and the information will be invaluable to us and others looking to transform energy use.”

By identifying the most effective approaches to significantly reduce energy consumption in older homes, FortisBC aims to mitigate emissions and help customers save on energy expenses.

The company commits to advancing energy efficiency as a cornerstone of its efforts to lead the clean energy transformation in the province.

By focusing on more intricate energy-efficiency opportunities, the company aims to assist customers in achieving the necessary GHG emissions reductions outlined in its Clean Growth Pathway to 2050 and in alignment with the province’s CleanBC plan.

Transforming Homes for a Sustainable Future

As FortisBC evolves its energy-efficiency programs, it will undertake deeper energy retrofit projects for more emission reductions.

The current pilot adopts an envelope-first approach. It prioritizes enhancements to the building envelope (outer shell) to prevent heat loss and reduce heating demand. This includes upgrades to walls, windows, doors, and insulation.

Additionally, each home and building will undergo upgrades to its heating, domestic hot water, and ventilation systems to maximize efficiency. This involves the installation of new gas heating technologies such as dual-fuel hybrid systems or gas heat pumps. These systems have achieved efficiencies of over 100% in manufacturers’ testing, with efforts to replicate these results in real-world settings.

Each of the participating homes and buildings has undergone a detailed energy assessment, modeling, and design phase, with early indicators showing promising results.

For instance, Metro Vancouver Housing is collaborating on the Manor House project. It’s a three-level apartment building built in 1972 in North Vancouver that provides affordable housing to 50 households. The project is expected to reduce GHG emissions by 66% and energy usage by 56%.

All 20 participating single-family homes have completed the majority of upgrades, and construction is now underway in the 4 apartment buildings. Once completed, each home and building will undergo testing for one year to assess energy savings.

With FortisBC planning to invest close to $700 million in energy-saving programs over the next 4 years, the insights gained from the pilot will be invaluable in identifying the most effective and affordable ways to lower energy consumption in existing buildings. The company will use the findings to determine replication strategies and establish benchmarks for future upgrade projects.

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Decarbonizing California: The Golden State’s Uphill Battle in the Climate Journey

March 21, 2024/in Uncategorized /by

California has made significant strides in its emission reduction journey while simultaneously expanding its economy, serving as a model for other states to follow in the energy transition. However, the state faces a challenging task in meeting its climate goal of cutting emissions by 40% from 1990 levels by 2030.

Accelerating Emissions Reduction: California’s Urgent Call to Action

According to a recent report by the San Francisco think tank Next10 and Los Angeles consulting firm Beacon Economics, California needs to accelerate its efforts to achieve deeper levels of decarbonization by the end of the decade.

The state must nearly triple its pace of annual emissions reductions to reach the 2030 target. This is especially crucial after its climate progress was temporarily stalled by the economic rebound following pandemic lockdowns.

The report suggests that California has to reduce emissions by an annual rate of 4.6% between 2022 and 2030. In comparison, the state has achieved an average rate of 1.5% between 2010 and 2021.

California is recognized as a leader in climate policy, technology, and renewable energy, but its performance in emissions reduction falls short.

The state’s greenhouse gas emissions increased by 3.4% in 2021, reaching 381.3 million metric tons of CO2 equivalent. This is primarily due to increases in the transportation and power sectors’ emissions, underscoring the need for intensified reduction efforts.

The report’s author and research manager at Beacon Economics, Stafford Nichols, noted that the rate of emission reduction has slowed since 2015-2016. He further emphasized the urgency for California to regain momentum in its climate action initiatives.

“While California is moving in the right direction in many ways, renewable electricity generation must greatly increase in the coming years in order to reach the state’s goal… we need to double the speed we are adding renewables to our power mix, from 4.3% per year to 8.7% per year.”

In October last year, the state enacted the country’s first-of-its-kind climate disclosure rule. It calls on businesses to report on their GHG emissions and climate-related financial risks.

California also banned the sale of gas-powered lawn care equipment according to a regulation that phases out small, off-road engines.

Powering Progress Toward a Green Grid

Transitioning to a greener grid is a strategic imperative for California as it grapples with rising emissions in its electric power sector. The sector saw a 3.5% increase from 2019 to 2021, primarily driven by in-state generation.

The power sector, ranking as the state’s 3rd-largest emitter behind transportation and industry, holds strategic significance in California’s efforts to decarbonize other sectors of its economy.

As California aims to electrify transportation, the adoption of zero-emission electric vehicles (ZEVs) has been instrumental.

In 2023, EVs accounted for around one-quarter of all new passenger vehicles sold in California. The state experienced a significant increase of 61.7% in new light-duty electric vehicle sales across all classes in 2022 compared to the previous year.

Remarkably, California achieved its 2025 goal of having 1.5 million ZEVs on the road two years ahead of schedule in April 2023. With an average annual increase in sales of 25.6% from 2018 to 2023, the state is projected to meet its 2030 target of 5 million ZEVs one year earlier than planned.

Source: https://www.gov.ca.gov/

The state’s electrical grid, however, sources 50% of its power from fossil fuels, mostly natural gas. Thus, the reliance of EVs on this grid shows the urgent need to transition to a cleaner energy mix.

Nationwide, the U.S. is unleashing the power of energy storage to address the rising EV adoption across the nation. California led the installations of new large-scale battery capacity in 2023, with 8,179 MW of operating batteries.

California’s Ambitious Targets and Grid Expansion Strategy

California is leveraging the rapid advancement of battery storage technology to include more variable renewable energy sources such as solar. This is crucial for ensuring grid reliability, especially considering the intermittency of renewable resources.

According to S&P Global data, California’s renewables portfolio standard mandates that solar, wind, geothermal, small-scale hydropower, and other eligible sources cover 44% of retail sales by 2024. That represents an increase of 52% by 2027 and 60% by 2030. Additionally, California aims to achieve the following reliance on renewables and other carbon-free sources:

90% by 2035,
95% by 2040, and
100% by 2045.

Achieving these bold targets entails expanding the grid infrastructure and investing in new transmission lines to accommodate cleaner energy sources. It would also be elemental in supporting the electrification of transportation and building sectors.

However, rising electricity prices pose a significant challenge to the state’s decarbonization goals. Regulators are legislators are exploring different ways to address this concern.

One proposed option is to extend California’s cap-and-trade program, established a decade ago, to generate additional revenue for energy bill relief rather than primarily funding climate initiatives. However, skeptics argue that this proposal carries potential pitfalls and its effectiveness remains questionable.

Despite setbacks, the state’s ambitious targets and innovative strategies signal a resilient commitment to combatting climate change. With concerted efforts to accelerate emissions reductions, transition to a greener grid, and expand renewable energy sources, California continues to inspire as a leader in climate action.

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Gulf Oil Giants Saudi Aramco and ADNOC to Launch Sustainable Lithium Extraction Projects

March 21, 2024/in Uncategorized /by

The Gulf giants Saudi Aramco and ADNOC (Abu Dhabi National Oil Company) have been actively pursuing diversification of their revenue streams, aiming to explore profitable ventures beyond oil. This move is driven by the necessity to finance extensive state programs and, in Saudi Arabia’s instance, the Vision 2030 plan spearheaded by Crown Prince Mohammed bin Salman.

This plan entails substantial investments in futuristic projects across the Saudi deserts, necessitating alternative sources of income. One such exciting project is lithium extraction from brine.

The purpose aligns with the global shift to clean energy and capitalizing on the EV market of Saudi Arabia and the United Arab Emirates. The demand for lithium is also expected to surge as it’s the key component of EV batteries.

Aramco and ADNOC’s Ambitious Lithium Extraction Plans

As per reports, Aramco and ADNOC’s lithium extractions plan are in a nascent stage. They are aiming to introduce a completely new technology i.e. extracting lithium from brine. Middle East contributes to global 55% of brine production originating from Saudi Arabia, UAE, Kuwait, and Qatar.

Both companies are exploring ways to tap lithium-rich brine from the vast stretches of salars and oilfield brines and subsequently process it to extract superior quality lithium for EV industrial applications.

Lithium extraction is an exhaustive mining process, that leaves behind a significantly high carbon footprint. Not only this, refining the mineral from brine involves high cost and a low concentration of net product. To mitigate environmental and cost implications, both ADNOC and Aramco will be using Direct Lithium Extraction (DLE) technology.

DLE is a new-age innovative solution to produce high-grade commercial lithium at a low cost for the clean energy manufacturing industry. This technique employs a selective absorbent to extract lithium from brine water. The resultant solution is further purified to produce high-grade lithium carbonate and lithium hydroxide.

Unlike other methods, DLE efficiently eliminates crucial impurities, ensuring a superior quality end-product.

A Diagrammatic Representation of Direct Lithium Extraction (DLE) from Brine Technology

Source: ibatterymetals.com

While ADNOC has not completely disclosed its extraction plan, it’s certainly exploring the latest and advanced technologies to make a smooth transition.

Filtering the ultralight battery metal from saltwater has the advantage of bypassing the necessity for expensive and environmentally taxing open-pit mines or extensive evaporation ponds. Such traditional rare earth mining processes are widely used in Australia and Chile.

America’s key players like ExxonMobil and Occidental Petroleum have also hailed the lithium extraction process from brine. They intend to line up with major oil giants across the globe to divulge from high carbon-emitting fossil fuels.

Gulf Nations Riding High on the Lithium Surge Wave

The Middle East has embraced the electric vehicle revolution with robust investment. The EV market was valued at US$2.7 billion in 2023 and is predicted to hit US$7.65 billion by 2028.

The transition in the transport sector from oil to electricity has pushed the demand for lithium in the UAE and Saudi Arabia. Both nations are bolstering the production of Li batteries and EVs with significant investment.

The UAE, as a part of its commitment to achieving net-zero emissions target aims to have 50% of all vehicles on the road as electric and hybrid by 2050.

Saudi Arabia has already launched its domestic EV brand CEER Motors two years back projecting an ambitious plan to manufacture 500,000 vehicles/year by 2030. This would automatically boost lithium demand and promise long-term green prospects for the rare earth mineral.

A significant update from the news is- the Saudi-based mining company Ma’aden is ramping up its pilot facilities to extract lithium from seawater using membrane-based lithium extraction technology.

Ma’aden’s endeavors to extract lithium from seawater could play a crucial role in addressing the increasing demand for this vital mineral in Saudi’s EV market.

In recent developments, UAE’s KEZAD Group and Titan Lithium sealed a $1.4 billion (AED 5 billion) deal to construct a high-tech lithium processing plant in Abu Dhabi.

According to the KEZAD group, on completion, the plant will import ~ 150,000 tonnes of lithium annually from their mines located in Zimbabwe. It will undergo processing in Abu Dhabi.

Mohamed Al Khadar Al Ahmed, CEO of KEZAD Group has exuberantly expressed his views on this momentous deal,

“We welcome Titan Lithium Industries to Kezad and look forward to the project’s significant contribution to the UAE’s strategic vision of diversifying its economy and reinforcing its position in the global market.”

The top Gulf nations – Saudi Arabia and UAE have abundant oil resources. They enable them to undertake financial ventures with confidence. Aramco and ADNOC have already envisioned the rising trend of lithium demand in the EV manufacturing sector.

We shall keep you posted with the latest innovations, developments, and deals happening in the rapidly growing lithium industry and EVs in the Middle East towards global sustainability.

Further Reading: Saudi Aramco Net Zero Goal by 2050, with 16 Million Carbon Credits/Offsets

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Carbon Pricing in Canada Set to Increase in April 1 by 23%

March 20, 2024/in Uncategorized /by

Canada’s carbon pricing system is poised for an increase on April 1, stirring debate and concern among provincial leaders over its impact on affordability. It serves as a pivotal policy tool aimed at reducing overall emissions by imposing a financial penalty on pollution.

Carbon pricing is spearheaded by Prime Minister Justin Trudeau’s minority Liberal government. While Trudeau’s administration views this as a cornerstone policy, some provincial leaders are urging a pause citing affordability worries.

Aligning Policies with Long-Term Climate Strategies

The impending hike in carbon pricing isn’t unexpected; rather, it aligns with the government’s long-term strategy to address climate change. Annual increases are scheduled until at least 2030.

This plan signals a commitment to steadily raise the price of carbon to encourage emission reduction efforts.

Provinces and territories have the option to adopt the federal pricing system voluntarily. For jurisdictions that don’t price carbon or don’t have a similar system in place that meets the minimum national stringency standards, they’ll be subject to the federal pricing system.

The federal pricing system includes two components:

A regulatory charge on fossil fuels such as gasoline and natural gas, called the fuel charge, and
A performance-based system for industries known as the Output-Based Pricing System.

These parts may apply individually or together in a given jurisdiction.

Only three regions have their own carbon pricing systems – British Columbia, Quebec, and the Northwest Territories.

Manitoba, Nunavut, Prince Edward Island, and Yukon have both parts of the federal pricing system in effect. Additionally, in Alberta, New Brunswick, Newfoundland and Labrador, Nova Scotia, Ontario, and Saskatchewan, the federal fuel charge operates alongside provincial carbon pricing systems for industry.

Source: Environment and Climate Change Canada (ECCC)

Despite calls for a pause, Trudeau’s administration maintains its stance. It emphasizes the importance of carbon pricing in signaling the need for investment in emission reduction while shielding middle-class families from bearing excessive costs.

The government aims to strike a balance between environmental sustainability and economic affordability, amidst diverse regional perspectives and economic contexts.

Addressing Affordability Concerns Amidst Climate Commitments

The April 1 increase will primarily affect gas prices and energy bills, particularly in provinces and territories subject to the federal backstop plan. This diversity in implementation underscores the complexities of coordinating national climate policies while accommodating regional nuances and preferences.

Premier Andrew Furey’s concerns echo those of other provincial leaders, who fear the mounting financial strain on households. Still, Trudeau’s administration remains steadfast, emphasizing the role of carbon pricing in incentivizing emission reduction. It also serves as a signal to investors on the importance of transitioning to a low-carbon economy.

The government’s commitment to addressing climate change is evident in its long-term vision, which includes steadily increasing the carbon price to achieve emission reduction targets.

The current carbon pricing stands at C$65 per tonne, slated to rise to C$80 per tonne on April 1. Then it will increase annually thereafter by C$15 until reaching C$170 per tonne by 2030. Price in Canadian dollars.

Source: RBN Energy LLC website

Additionally, the government offers the Canada Carbon Rebate, formerly known as the climate action incentive payment, to eligible Canadians impacted by the federal carbon price. This rebate aims to mitigate the financial burden and ensure that the transition to a low-carbon economy is fair.

Approximately 80% of Canadians receive more from the rebates than they pay in carbon pricing, according to the government’s data.

Balancing Effectiveness and Critiques of Carbon Pricing

While some criticize carbon pricing as burdensome, Trudeau’s administration emphasizes its effectiveness in encouraging emission reduction and protecting vulnerable households. By steadily increasing the carbon price and offering rebates to mitigate impacts on households, Canada seeks to strike a balance between environmental sustainability and economic affordability.

The impending increase in Canada’s carbon price reflects the government’s commitment to addressing climate change and transitioning to a low-carbon economy.

Despite concerns over affordability, Trudeau’s administration is firm in its view that carbon pricing is a critical tool for reducing emissions and signaling the need for investment in clean energy.

As the April 1 deadline approaches, the debate over carbon pricing highlights the complexities of balancing environmental and economic priorities in the fight against climate change.

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Amazon and Aramco Invest in CarbonCapture’s $80M Raise for DAC

March 20, 2024/in Uncategorized /by

CarbonCapture Inc., a prominent US-based direct air capture (DAC) company, has announced the successful completion of its $80 million Series A financing. This achievement follows the addition of several strategic investors, including Amazon’s Climate Pledge Fund, Aramco Ventures, and Siemens Financial Services.

The financing round was led by Prime Movers Lab, a notable investor in groundbreaking scientific startups, with participation from Idealab X, Marc Benioff’s TIME Ventures, Neotribe Ventures, Alumni Ventures, and several other venture investors. The funds will be used to further advance technology development and to deploy early installations of CarbonCapture’s modular DAC systems.

RELEVANT: How Direct Air Capture Works (And 4 Important Things About It)

Adrian Corless, CEO of CarbonCapture Inc., expressed excitement about welcoming the new strategic investors while noting that:

“To realize our ambitious mission to decarbonize the atmosphere, it’s imperative that we marshal the capabilities of the global industrial community…Together, we’re stepping closer to a cleaner, healthier planet for future generations.”

Atmospheric Alchemy: CarbonCapture’s DAC Triump

CarbonCapture is a direct air capture (DAC) startup that specializes in modular DAC machines. They can be interconnected in large arrays to remove substantial amounts of CO2 directly from the atmosphere. Its initial modules, located in Wyoming, are designed to capture and store approximately 10,000 metric tons (Mt) of CO2 annually.

The company has set an ambitious goal to remove 5 million Mt of CO2 annually by 2030 through a phased approach to CO2 removal, consisting of four phases. If successful, this carbon removal goal would be significant, given that the current annual global capacity for CO2 removal stands at only 0.01 million Mt of CO2.

The DAC modules resemble vented shipping containers and are capable of filtering out 75% of carbon from the air passing through them. The captured CO2 is then injected 12,000 feet underground into saline aquifers for permanent storage.

CarbonCapture’s DAC project, known as Project Bison, is groundbreaking for several reasons:

It represents the first massively scalable deployment of DAC technology, with the potential to scale up to megaton levels.
It is the first project to use Class VI injection wells for DAC carbon storage. Class VI wells are for permanent CO2 storage once approved.
It could become the largest single DAC project in the world if it achieves its goal of 5 megatons of annual carbon capture and storage by 2030.

The company has already secured over $26 million in carbon removal credits through pre-sales to leading global companies such as Microsoft, Boston Consulting Group, Alphabet, Meta, Stripe, Shopify, McKinsey & Company, and JPMorgan Chase & Co.

Funding the Future of CDR

Direct air capture is an emerging CDR technology and so, it costs relatively higher than established carbon removal approaches. This is because atmospheric carbon is much more dilute than the flue gas of a power station, for instance.

Here are the costs of direct air capture in USD per ton of CO2, based on CO2 concentrations.

As DAC technology has not yet been demonstrated on a large scale, its costs remain uncertain. Capture cost estimates range anywhere from $200 to $700 per ton of CO2.

The actual cost of DAC depends on several factors, including energy source, carbon price, technology choice, capital expense, etc. All these factors influence the regional cost of carbon removal through direct air capture. Scaling up this removal technology is crucial to bring down its cost.

CarbonCapture’s DAC technology has achieved significant technical and commercial progress.

Pioneering DAC Innovation

Dr. Adiari Vazquez, Investment Partner at Amazon’s Climate Pledge Fund highlighted CarbonCapture’s innovation in advancing the scalability and accessibility of carbon removal. He added that effective, verifiable, and durable carbon removal, such as that achieved through CarbonCapture Inc.’s DAC system, will be crucial for a net zero carbon future.

Last year, Amazon inked its first investment in CDR credits with one of the world’s biggest DAC companies 1PointFive. It’s the first deal that Amazon made in DAC at this scale, with the credits coming from 1PointFive’s Stratos plant.

Aramco Ventures is also pleased to support CarbonCapture’s unique, modular direct air capture platform. Aramco, alongside Chevron and Samsung, also invested in a UK-based carbon capture tech startup’s $150M raise in 2022.

Siemens Financial Services’ investment further amplifies the CDR company’s role in commercializing direct air capture in the US. Their expertise and portfolio of digital process simulation, automation, and control solutions will support CarbonCapture’s ambitious plans to deploy DAC systems at scale.

CarbonCapture’s successful $80 million financing round signifies a major leap forward in the quest for direct air capture. With innovative DAC technology and strategic partnerships, CarbonCapture is driving meaningful progress towards a sustainable, carbon-neutral future.

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BlackRock’s Insights on 2024 Low-Carbon Transition Investment Trends

March 20, 2024/in Uncategorized /by

Investment giant BlackRock has released a new report outlining key developments expected to impact low-carbon transition-related investment opportunities and risks in 2024.

BlackRock singles out low-carbon transition as a major investment driver while emphasizing specific areas, including clean energy, electrification, and climate resilience.

The report anticipates a significant reallocation of capital towards rewiring energy systems and investing in climate resilience to mitigate risks.

In the outlook for 2024, BlackRock identified three key areas that stand out as potentially shaping the market significantly.

Electrifying Expectations: Battery Prices and Market Dynamics

Firstly, the downward trend in battery prices has the potential to drive increased demand for energy storage solutions in power grid infrastructure and the adoption of electric and hybrid vehicles.

Battery prices makes up a significant portion, often a third or more, of the production expenses for various clean technologies. These include energy storage systems for power grids and electric and hybrid vehicles (EVs).

Over the past decade, there has been a notable decline in battery prices, as shown in the chart below.

While there was a slight uptick in 2022, recent signals from battery producers suggest the potential for substantial price reductions in the coming year. This downward trajectory can be primarily due to an 80% drop in lithium prices, a crucial component, driven by increased supply.

Intense market competition and rapid technological advancements also contribute to lowering prices. Some companies are leveraging artificial intelligence, another influential force, to explore novel battery materials, further driving down future costs.

The key question remains whether this continued decline in battery prices will translate into reduced final purchase prices. In turn, this can potentially spur greater demand for energy storage systems, EVs, and hybrid vehicles.

Given their lower operational costs compared to traditional internal combustion vehicles, such a trend could have significant implications for the broader automotive industry and energy sector.

Political Power Plays

Secondly, upcoming elections worldwide could significantly impact future energy and industrial policies, influencing the direction of transition efforts, per BlackRock report.

The year 2024 sees a multitude of elections across significant regions like the European Union, the United States, and India.

Governments worldwide are grappling with the delicate balancing act of pursuing decarbonization while ensuring energy security and affordability. The outcomes of these elections could profoundly influence how this balance is achieved and consequently impact the trajectory of the low-carbon transition and adoption of clean technology globally.

Many governments are actively subsidizing their energy and clean technology sectors, creating pricing and margin pressures for non-subsidized competitors.

Moreover, election results may prompt changes in transition-related policies, potentially either accelerating or slowing down the transition in different regions. For instance, in India, continuity in policy post-election could speed up decarbonization efforts and bolster the country’s position as a leading clean technology production hub.

Similarly, the outcome of the U.S. election could have implications for existing legislation, such as the Inflation Reduction Act of 2022, which has catalyzed significant investments in energy infrastructure and technology.

Possible changes range from repeal or delays to complementary policies aimed at enhancing its effectiveness, such as land permitting reform.

Weathering the Storm

Lastly, another crucial focus in 2024 revolves around the impact of climate change-induced extreme weather events, prompted by 2023 as the hottest year on record by the World Meteorological Organization. This trend is expected to continue this year, further highlighting the urgent need for climate resilience measures.

Investors are beginning to show greater interest in companies and technologies that contribute to climate resilience. This includes innovations such as early monitoring systems for floods, air conditioning solutions to combat heatwaves, and building retrofitting for enhanced resilience against extreme weather events.

Despite this growing interest, markets may still underestimate the potential for firms specializing in resilience-boosting products and services.

Overall, BlackRock anticipates that falling battery prices could stimulate growth in the EV and energy storage industries in 2024. However, the direction of the global transition policy post-election will heavily influence investment opportunities and risks. As physical climate risks mount, the report suggests that climate resilience could emerge as a prominent investment theme this year.

Apart from the transition to a low-carbon economy, BlackRock also tracks these four other mega forces:

Demographic divergence
Digital disruption and artificial intelligence (AI)
Geopolitical fragmentation and economic competition
Future of finance

BlackRock’s report underscores the dynamic landscape of low-carbon investments in 2024, driven by evolving market dynamics, political shifts, and climate resilience imperatives. As battery prices decline and election outcomes unfold, investors face both opportunities and risks in navigating the transition to a sustainable future.

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Google the First to Join DOE’s Carbon Removal Challenge with $35M Pledge

March 18, 2024/in Uncategorized /by

Amidst escalating climate change concerns, the Department of Energy (DOE) is spearheading initiatives to accelerate the deployment of carbon dioxide removal technologies.

For the first time, the Department is purchasing $35 million in carbon removal credits through its Carbon Dioxide Removal Purchase program and Google is the first company to answer the call, matching DOE’s $35 million commitment.

Carbon Clearinghouse: DOE’s Bold Move

The Intergovernmental Panel on Climate Change’s (IPCC) report suggested that scenarios that limit warming to 1.5°C include scaling carbon dioxide removal methods to billions of tons of removal annually over the coming decades. However, the report also highlighted that most existing removal solutions are in their early stages and currently limited in scale.

To help scale the industry, the Department of Energy (DOE) launched the Carbon Negative Shot in 2021. This initiative aims to support innovation in different CO2 removal pathways. These include Direct Air Capture (DAC), soil carbon sequestration, ocean-based CO2 removal, and reforestation, among others.

The direct air capture sector witnessed notable advancements recently. These include recent CarbonCapture’s successful raise of $80 million in Series A funding and Climeworks unveiling its US headquarters in Austin, Texas.

The Department’s goal is to enable carbon capture and storage at gigaton scales for less than $100 per net metric ton of CO2e by 2032. In September 2023, the DOE announced the Carbon Dioxide Removal Purchase Pilot Prize. This effort makes $35 million in funding available to purchase carbon removal credits to support commercial carbon dioxide removal companies.

Companies and collectives have invested billions in carbon removal, benefiting the industry significantly. This trend highlights the importance of integrating carbon removal into climate strategies, serving as a backup for residual emissions.

As more organizations commit to net zero targets, carbon removal becomes crucial. With technological advancements, carbon removal projects are more accessible and verifiable.

However, future supply limitations may pose challenges for late adopters. And this major challenge remains: how to encourage more organizations to start buying voluntary carbon removal credits.

DOE’s Campaign Fuels Carbon Capture

Expanding the investment to other companies and organizations, the DOE announced the Voluntary Carbon Dioxide Removal Purchasing Challenge. This initiative calls on organizations to make public larger and bolder purchase commitments similar to the DOE’s $35 million carbon removal purchase pilot.

But unlike the Pilot Prize, the Challenge does not entail additional federal funds.

As part of the challenge, the DOE will create a public leaderboard recognizing buyers and tracking voluntary carbon removal purchases. It addresses non-financial barriers such as market transparency and recognition of the importance of carbon removal credits. Thus, the Challenge seeks to foster greater participation in carbon removal efforts.

How the Challenge Fits into DOE Carbon Removal Programs

The DOE is providing supporting materials for buyers to make larger carbon removal purchases while assisting CDR credit suppliers in finding more customers.

Additionally, the DOE has been actively involved in establishing DAC hubs in Texas and Louisiana. The Texas DAC Hub is spearheaded by Occidental subsidiary 1PointFive in collaboration with partners Worley and Carbon Engineering. Meanwhile, the Louisiana project, named Project Cypress, is led by the non-profit organization Battelle, alongside technology developers Climeworks and Heirloom.

Google Leads the Charge

Google is the first company to join the DOE’s challenge, matching the Department’s $35 million commitment.

Through its initiatives, Google intends to contract for at least $35 million worth of carbon removal credits over the next 12 months.

This model of mutually reinforcing public-private support is a crucial tool for commercializing carbon removal solutions. Like many emerging technologies, governments and companies have essential and complementary roles in demonstrating promising carbon removal approaches and scaling them commercially.

Randy Spock, Google’s Carbon Credits and Removals Lead, noted that:

“We’re working hard to reduce our own emissions across our operations and value chain, but we know that tackling global climate change will require a diverse set of tools to both reduce emissions and remove them from the atmosphere.”

Spock further highlighted that deploying CDR to address hard-to-abate residual emissions is critical to achieving net zero emissions.

This CDR effort builds on Google’s recent purchases through Frontier, a pioneer advance market commitment to scale breakthrough CDR approaches. The tech giant is also a part of the First Movers Coalition, a global initiative of companies collaborating to signal demand for emerging climate technologies.

Google’s decision to join the challenge and commit to purchasing carbon removal credits in advance has sparked anticipation that other tech giants may do the same. Companies like Amazon and Microsoft have already been actively purchasing such carbon credits directly from issuing companies throughout 2023.

The Department of Energy plans to highlight similar announcements going forward, hoping “to unlock game-changing capital for high-quality and affordable CDR in time to meet our climate goals.”

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US Imports of Lithium and Critical Minerals Drop Amidst Shifting EV Market

March 18, 2024/in Uncategorized /by

Critical minerals, including lithium, nickel, cobalt, copper, and rare earths, are essential in the manufacturing of clean energy technologies, spanning from wind turbines to electric vehicles (EVs). Over the last two decades, the annual trade in energy-related critical minerals has surged from $53 billion to $378 billion.

However, US imports of lithium materials and critical minerals, crucial components for EV batteries, saw a decline in 2023 compared to the previous year, per data from S&P Global Market Intelligence. This reflects the subdued demand for EVs.

In 2023, imports of processed and refined lithium totaled 17,130 and 57,210 metric tons, respectively, marking decreases of 2.4% and 20.5% compared to 2022, as reported by Market Intelligence data.

US processed lithium imports saw an uptick in the 4th quarter of 2023 following a rise in the 3rd quarter. However, import levels remained below the record high set in the March quarter of the same year.

The first quarter of 2023 witnessed a record in US imports of lithium-ion batteries as seen in the chart below. This is primarily due to market anticipation of robust EV sales for the year ahead.

Source: S&P Global

Factors Behind US Import Decline of Critical Minerals

Analysts attribute the subdued sales growth in Europe and the US during the second half of 2023 to various factors. These include a higher interest rate environment and a greater price premium for battery electric vehicles compared to internal combustion engine vehicles.

However, there are expectations for an uptick in EV demand in 2024.

According to a February report by S&P Global Mobility, the development of battery-electric vehicle (BEV) sales in the US is expected to continue to grow through 2024. This projection nearly doubles the number of BEV models available by the end of the year compared to 2022.

While it’s true that growth in the global EV market has been decelerating, it’s crucial to maintain the right perspective. In 2021, EV sales more than doubled, experiencing an extraordinary growth rate of nearly 120%.

Remarkably, in January of this year, over 1.1 million EVs were sold worldwide, compared to 660,000 sold during the same period last year, marking a new monthly global sales record. This represents a remarkable 69% year-over-year growth, significantly surpassing the average growth rate observed in the previous year.

This growth trend in EV sales means lithium production must also keep up.

Trends in US Lithium Imports and Battery Market

In the fourth quarter of 2023, US imports of processed lithium totaled 4,026 metric tons, marking a 6.8% increase year over year. Market Intelligence data reveals that Argentina and Chile contributed 51.6% and 46.1% of these imports, respectively.

Raw lithium undergoes processing and subsequent refinement into chemicals suitable for use as cathode materials and electrolyte solutions in batteries. During the December quarter, the US imported 15,960 metric tons of refined lithium. That represents a 3.5% increase from the 15,426 metric tons imported during the same period in 2022.

Canada accounted for 63.4% of the US imports of refined lithium in the fourth quarter, according to the data.

According to forecasts from Commodity Insights, China would see a decline in its market share in lithium-ion battery production between 2023 and 2030.

Meanwhile, North America’s lithium-ion battery capacity is anticipated to grow at a rate of 22% during this period. The bulk of this growth would take place in the United States, with two projects also slated for Canada.

READ MORE: Accelerating Lithium Demand and Construction Surge in US and Canada

Additionally, US imports of critical minerals amounted to 612,590 metric tons in 2023. That represents a significant decline of 39.1% year over year.

US Dependency in Critical Mineral Imports

Market Intelligence data further reveals that critical mineral imports totaled 195,805 metric tons in the 4th quarter of 2023. That accounts for a 6.6% increase from the 183,621 metric tons recorded in the fourth quarter of 2022. Notably, Gabon accounted for 47.1% of US imports of critical minerals during the same quarter.

Globally, trade in critical minerals has experienced substantial growth over the past two decades, with an average annual growth rate of 10%. The value of imports has nearly doubled in five years, soaring from $212 billion in 2017 to $378 billion in 2022, according to World Trade Organization data.

Particularly noteworthy is the significant increase in trade in helium and lithium which showed impressive annual growth rates of up to 53% during the same period.

In 2022, China emerged as the largest importer of critical minerals, comprising 33% of the global total. Following China, the European Union accounted for 16%, while Japan and the United States both stood at 11%.

The transition towards a more sustainable future necessitates access to various critical minerals vital for transitioning to the green economy. However, the US currently faces a significant reliance on imported nonfuel minerals, potentially exposing vulnerabilities in the nation’s supply chains.

According to data from the U.S. Geological Survey (USGS), the United States is entirely dependent on imports for at least 12 key minerals identified as critical by the government. Notably, China emerges as the primary source of imports for many of these critical minerals, as well as numerous others.

The graphic illustrates America’s import dependence for 30 key nonfuel minerals, highlighting the primary import sources for each mineral.

The decline in US critical minerals imports amidst EV market fluctuations underscores supply chain complexities. Despite subdued demand in 2023, projections suggest future growth. Global trade in critical minerals surges, emphasizing the need for strategic domestic resource management to secure a stable supply for the green economy.

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XPRIZE Launches New Competition: Water Scarcity

March 15, 2024/in Uncategorized /by

Xprize Foundation, a non-profit organization that encourages technological development, has introduced its latest initiative – the XPRIZE Water Scarcity competition. This groundbreaking competition offers a total prize purse of $119 million over five years.

XPRIZE operates highly impactful, incentivized prize competitions that tackle some of the world’s most pressing challenges. These competitions are structured to push the boundaries of innovation and creativity, driving participants to develop groundbreaking solutions that have the potential to transform the world for the better.

At the heart of an XPRIZE competition is a powerful incentive structure encouraging individuals, teams, and organizations to channel their ingenuity and expertise toward addressing complex global problems.

In 2021, XPRIZE launched the Carbon Removal competition. It aimed to encourage the development of innovative CO2 removal solutions to cut emissions. In April 2022, the competition then revealed the 15 winning teams which received $1 million each to fund their projects. This initiative has been closed this year.

Tackling the Global Water Crisis

The new XPRIZE competition offers a total prize of $119 million, made possible by the Mohamed bin Zayed Water Initiative. The primary objective of this competition is to address the pressing issue of global water scarcity by fostering the development of reliable, sustainable, and affordable seawater desalination systems.

Although our planet is predominantly covered by water, only a minuscule fraction (0.5%) of it is readily available to support the needs of the Earth’s population, which currently stands at around 8 billion people.

Water scarcity is a critical issue affecting 80% of the global population, posing serious threats to communities worldwide. With the water demand projected to outstrip supply by 40% by 2030, urgent action is needed to address this looming crisis.

However, traditional desalination methods face significant challenges.

One of the major drawbacks of these methods their negative environmental impacts, worsening the very issues they aim to address. The energy-intensive nature of desalination processes leads to increased carbon emissions and energy consumption, further contributing to climate change.

Roughly 2.5% of the world’s total energy consumption is dedicated to treating contaminated water and managing water supply systems. Additionally, a significant portion of greenhouse gas emissions, approximately 60%, is attributable to energy consumption.

The carbon footprint linked to the reverse osmosis (RO) desalination process of seawater falls within the range of 0.4 to 6.7 kilograms of CO2 per cubic meter. This implies that desalinating 1000 cubic meters of seawater could potentially result in emitting up to 6.7 tons of CO2.

Existing desalination methods not only pose significant environmental risks but also remain financially out of reach for many low- to medium-income countries. Consequently, there is an urgent need for innovative solutions that can effectively harness Earth’s vast ocean water resources.

This is what the XPRIZE water competition tries to address.

Innovating Solutions for a Thirsty World

The XPRIZE Water Scarcity competition aims to address the challenge by encouraging participating teams to develop novel desalination technologies. These technologies will pave the way for a future where clean water is abundantly available to all.

Competing teams are encouraged to develop solutions that not only address water scarcity but also contribute to broader sustainability goals, including climate action and ecosystem protection. Winning teams should excel at creating desalination technologies that possess several key characteristics:

Scalability
Cost-effectiveness
Reliability
Resilience in changing climate
Environmental sustainability

XPRIZE Water Scarcity is a multi-track competition, divided into two distinct tracks. Each track has its own objectives geared towards making a significant impact on global water availability.

Track A: The New Desalination System. This track offers a prize pool of $70 million and focuses on developing innovative desalination systems. Within this track, there are also Moonshot Awards totaling $20 million, intended to incentivize breakthrough innovations in desalination technology.
Track B: Novel Membrane Materials. With a prize pool of $9.5 million, Track B concentrates on the development of novel membrane materials for desalination processes.

Detailed competition guidelines and entry requirements are accessible in the Guidelines document by XPRIZE. Below are important milestones and timeline to remember.

The success of the XPRIZE Water Scarcity competition holds the potential to make a profound impact on global water security and environmental sustainability.

It can help unlock access to the vast reserves of seawater, make up more than 96% of Earth’s water resources. By incentivizing the development of new, reliable, cost-effective, and sustainable desalination solutions, the prize aims to address the root causes of water scarcity and alleviate water stress worldwide.

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