IEA Net Zero Roadmap: Zero Percent Chance
PLUS: Microsoft's carbon removal, DHL RNG, Colgate goes 100% solar, Climate disclosure coming , Fervo breaks ground
Carbon Streaming Corporation (NEO: NETZ) will supply Microsoft with carbon removal credits from the Waverly Biochar project.
The Waverly Biochar project, located in Waverly, Virginia, aims to provide up to 10,000 tonnes of carbon dioxide removal credits annually to help Microsoft achieve its carbon negative goal.
Oliver Forster, Vice President of Sales at Carbon Streaming, highlights biochar's scalability and cost-effectiveness for corporate carbon removal commitments.
Microsoft's senior director, Brian Marrs, emphasizes the importance of Carbon Streaming's project-level finance in advancing the biochar industry.
Biochar is a method of carbon storage by burying it in soils and has the potential to sequester significant carbon emissions, as per Project Drawdown.
Achieving gigaton-scale carbon removal through biochar requires both supply and demand growth, with Microsoft committing to offtake verified carbon dioxide removal from the Waverly Biochar facility.
Carbon Streaming's approach provides project capital to developers, allowing corporations to commit to purchasing verified removals instead of investing upfront capital in climate projects, thereby facilitating corporate climate action.
The IEA's Net Zero Roadmap reports that driving greenhouse gas emissions to net zero and limiting global warming to 1.5°C is still feasible due to record growth in clean energy technologies.
Clean energy progress, including solar power and electric vehicles, aligns with a pathway to achieve net-zero emissions by mid-century.
Clean energy innovation has reduced the proportion of emissions reductions needed from not-yet-available technologies from 50% to around 35%.
The updated roadmap emphasizes the need for bolder action in the coming decade, including tripling global renewable power capacity by 2030, doubling energy efficiency improvements, increasing electric vehicle and heat pump sales, and reducing energy sector methane emissions by 75%.
Strong international cooperation is deemed crucial to success, with a plea to separate climate from geopolitics.
The roadmap promotes a net-zero emissions pathway for the global energy sector by 2050, considering national circumstances and equity.
Staying on track requires advancing net-zero targets and significant increases in investment, particularly in emerging and developing economies.
In this scenario, clean energy spending rises from USD 1.8 trillion in 2023 to USD 4.5 trillion annually by the early 2030s.
The policy-driven expansion of clean energy capacity reduces fossil fuel demand by 25% by 2030, leading to a 35% emissions reduction compared to 2022 levels.
Stronger and more diverse supply chains for clean energy technologies and critical minerals are crucial.
The report underscores the need for international cooperation to limit global warming to 1.5°C and warns of increased climate risks if ambition and implementation don't accelerate by 2030.
Delayed action could require massive carbon removal technologies, posing challenges and costs.
The IEA encourages stronger ambition and implementation in the lead-up to the COP28 climate summit in Dubai.
The IEA's latest report serves up ambitious goals, but can they really be achieved?
Expecting a 25% fossil fuel demand drop in just 7 years? That's an impossible ask, even with another pandemic.
Coal's still got a comfy seat at the energy table, and it's not budging.
Colgate-Palmolive signs a 20-year Virtual Power Purchase Agreement (VPPA) for a solar energy farm in Waco, Texas.
The Markum Solar Farm, with a capacity of 209 megawatts, is expected to start operating in 2025.
This solar project will generate the equivalent of 100% of Colgate's electricity needs for its U.S. operations.
Colgate-Palmolive aims to achieve Net Zero carbon emissions by 2040 and 100% renewable electricity across its global operations by 2030.
The company's commitment to renewable energy is part of its 2025 Sustainability & Social Impact Strategy.
Colgate has already implemented on-site solar projects at various global facilities, with approximately 52% of its global electricity consumption coming from renewable sources as of December 31, 2022.
The solar farm is being developed by Scout Clean Energy, with advisory support from 3Degrees.
DHL Supply Chain is investing €80 million in a specialized biomethane production facility in Cork, Ireland.
The facility will produce biomethane, a renewable gas with carbon-neutral potential, to fuel 150 trucks.
Managed by Stream BioEnergy, it will process 90,000 tonnes of food waste annually, reducing carbon emissions by 15,000 tonnes per year.
DHL will subsidize biomethane from other sources during the initial vehicle rollout and production ramp-up.
When fully operational, DHL will use 92 locally fueled biomethane trucks for Tesco's nationwide network.
Biomethane deployment in Ireland does not require upgrades to the existing gas grid, making it a flexible and cost-effective solution for decarbonizing commercial road transport.
DHL plans to extend its decarbonization efforts to various sectors, including consumer, technology, aviation, life sciences, and healthcare.
Fervo Energy initiates exploration drilling at Cape Station, a groundbreaking 400 MW next-gen geothermal project in Beaver County, Utah.
Cape Station will deliver 24/7 carbon-free electricity, commencing power supply to the grid in 2026 and full-scale production by 2028.
The project will create approximately 6,600 jobs during construction and sustain 160 full-time jobs, contributing over $437 million in earned wages.
The project received Environmental Assessment approval from the Utah Bureau of Land Management in February, emphasizing environmental commitment and community engagement.
Utah's significant geothermal potential, especially in the southwest, makes it an ideal location for the project.
Cape Station benefits from the Department of Energy's Frontier Observatory for Research in Geothermal Energy (FORGE).
Fervo Energy's previous success with Project Red, an enhanced geothermal system, showcased its innovative drilling technology.
The project is expected to infuse $1.1 billion into local supply chains and businesses, fostering economic growth in Beaver County.
Fervo is collaborating with established oil and gas companies such as Helmerich & Payne, Devon Energy, and Liberty Energy to advance the project.
California and the European Union are set to approve rules that mandate companies, both private and public, to disclose their greenhouse gas emissions.
These rules go beyond what was expected at the federal level in the U.S., and they require companies to calculate and disclose emissions from their suppliers and customers as well.
The size of California and the EU's economies means that many large companies cannot avoid complying with these rules.
The rules will be a significant change in corporate disclosures, adding climate information to financial data to compare companies and assess their emission reduction efforts.
The Securities and Exchange Commission (SEC) in the U.S. previously faced pushback from businesses and Republicans regarding emissions and climate risk disclosures for public companies.
California is moving forward with its emissions disclosure rules, while the European rules are under review and expected to be approved soon.
The disclosure requirements could be challenged in court or by a referendum, potentially delaying implementation.
Investors plan to use this information to compare businesses, track emission reduction progress, and identify climate change-related risks.
Climate activists hope these disclosures will encourage heavy polluters to reduce emissions and increase capital costs for non-compliant firms.
The rules will require significant data gathering, processing, and reporting, especially for private firms that don't disclose much information about their businesses.
The new rules also cover Scope 3 emissions, which come from suppliers and customers and are a significant part of many companies' carbon footprints.
Data suppliers, including large accounting firms and startups, are emerging to help companies estimate and report Scope 3 emissions.
The timing of these rules coincides with government incentives and private investments aimed at reducing carbon emissions.
Companies are seeking consistency among regulators to limit the cost of compliance, given that many firms regulated by the SEC will also need to adhere to California's disclosure rules.
Some unexpected but welcomed transparency from the EPA on permits in progress for Class VI carbon sequestration. Link here for the high quality PDF.
What'd ya think of today's email?
DISCLAIMER: None of this is financial advice. This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. Please be careful and do your own research.